August 2, 2018 / 11:26 AM / 2 months ago

US STOCKS-Tech, industrials lead futures lower on renewed tariff fears

* Chinese goods worth $200 bln face 25 pct tariff, up from 10 pct

* 25 Dow Industrial components trading in the red premarket

* Boeing, Caterpillar, chipmakers, FAANGs down roughly 1 pct

* Tesla jumps on profit promise as Model 3 output steadies

* Futures down: Dow 0.68 pct, S&P 0.63 pct, Nasdaq 0.75 pct

By Amy Caren Daniel

Aug 2 (Reuters) - Technology and industrial companies pushed U.S. stock index futures lower on Thursday, as fears of a trade spat between the United States and China failed to let up after President Donald Trump proposed 25 percent tariffs on $200 billion worth of Chinese imports.

U.S. Trade Representative Robert Lighthizer said Trump directed the increase from a previously proposed 10 percent duty because China has refused to meet U.S. demands and has imposed retaliatory tariffs on U.S. goods.

Beijing responded to the new threat saying it was ready to escalate the trade war.

As has been the case through the trade spat, shares of trade-sensitive companies were the first to be hit. All 25 of the 30 companies on the blue-chip Dow Jones Industrial Average that were trading premarket were lower.

Caterpillar and Boeing both dropped more than 1 percent premarket. Chipmakers, whose major clients include Chinese companies, also declined, with Micron, Nvidia , AMD and Intel down between 0.9 percent and 1.8 percent.

The so-called FAANG group of stocks — Facebook, Apple , Amazon.com, Netflix and Google-parent Alphabet — dropped between 0.7 percent and 1 percent.

"The trade tensions are making investors risk-averse today while they digest the Fed's interest rate decision," Naeem Aslam, chief market analyst at Think Markets said in a note.

The Federal Reserve kept interest rates unchanged on Wednesday but characterized the economy as strong, keeping the central bank on track to increase borrowing costs in September.

At 6:57 a.m. ET, Dow e-minis were down 173 points, or 0.68 percent. S&P 500 e-minis were down 17.75 points, or 0.63 percent and Nasdaq 100 e-minis were down 54.25 points, or 0.75 percent.

Among the few bright spots in early premarket trading was Tesla. The electric car maker's stock jumped 8.2 percent after the company said it would produce its new Model 3 sedans at a profit, buoying hopes it will stanch its financial losses in the second half of the year.

Square fell 2.2 percent after the payment processor issued weaker-than-expected forecast for the third quarter.

Economic data on tap includes the Labor Department jobless claims report at 8:30 a.m. ET that will likely show initial claims rose to a seasonally adjusted 220,000 last week, from 217,000 the week earlier.

Meanwhile, the Commerce Department report at 10 a.m. ET is likely to show that factory goods orders rose 0.7 percent in June, compared with a 0.4 percent increase in the previous month. (Reporting by Amy Caren Daniel in Bengaluru; Editing by Shounak Dasgupta)

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