Investing.com – U.S. futures were lower on Thursday as Sino-U.S. tensions increased after U.S. lawmakers introduced bills that would ban the sale of American chips to Chinese companies.
The proposed law drew the ire of China and could put trade talks between the two largest economies in the world in jeopardy.
The proposed bills would ban the sale of U.S. chips to Huawei and other Chinese companies that violate U.S. sanctions or export control laws. It emerged late Wednesday that Huawei is also under investigation for allegations that it stole trade secrets.
Chinese Foreign Ministry spokeswoman Hua Chunying called the U.S. legislation "hysteria,” prompting worry over possible retaliation.
"China is unlikely to shrug this off which is creating a risk-off environment. Signs of retaliation from China could see stocks sink further," said Jasper Lawler, head of research at London Capital Group.
On the earnings front, Fastenal (NASDAQ:FAST) and PPG Industries (NYSE:PPG) are set to report in the morning, while American Express (NYSE:AXP), JB Hunt (NASDAQ:JBHT), and Netflix (NASDAQ:NFLX) are expected to report after the closing bell.
Morgan Stanley (NYSE:MS) slumped over 2% after its earnings came in lower than expected.
Apple (NASDAQ:AAPL) fell 0.8% in premarket trading, while Microsoft (NASDAQ:MSFT) dipped 0.6% and semiconductor company Micron (NASDAQ:MU) slipped 0.6%. Tesla (NASDAQ:TSLA) was down 0.5% after news that it is ending its customer referral program to help with the cost of its Model 3 vehicle. Texas Instruments (NASDAQ:TXN) dipped 2%, while AT&T (NYSE:T) inched down 0.5%.
Elsewhere, Pacific Gas & Electric Co (NYSE:PCG) gained 2.7%.
In commodities, gold futures inched up 0.05% to $1,294.45 a troy ounce, while crude oil fell 1.3% to $51.63 a barrel. The U.S. dollar index, which measures the greenback against a basket of six major currencies, was flat at 95.68.
-Reuters contributed to this report.
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