Financial markets are under pressure on Wednesday following a
report that President Donald Trump asked former
FBI director James Comey to drop an investigation into
former US national security adviser Michael Flynn in
US stock futures are indicating a lower open for trading.
S&P 500 futures are down by nine points, or 0.39%, at
7:32 a.m. ET. Dow futures are down 76 points (-0.37%.)
The US dollar’s losses are deepening, and the currency’s
index is at its lowest level since late October, before the
US election that spurred its rally to a 14-year
Major stock indexes in Asia and Europe are also trading
lower. The TOPIX in Tokyo is down 0.5%, pressured by the stronger
yen. Australia’s ASX 200 is also down by around 1.1%, a stark
turnaround in fortunes given SPI futures were indicating a flat
start to trade.
The latest news “merely add fuel to the existing fires
of political uncertainty,” with “apparent White House
incoherence slowly sapping faith in stimulus policies
getting even partisan approval,” said Mike van Dulken, the head
of research at Accendo Markets, in a note.
Safe-haven assets are the exception to market weakness.
The Japanese yen is up by 0.6%, trading at 112.42 against the US
dollar, while gold is up by 0.8%, currently sitting at $1,246.52
According to The New York Times, Comey reportedly created records
of interactions he had with Trump which he deemed “improper
efforts to influence an ongoing investigation”.
During the meeting, the president asked him to drop the FBI
investigation, Comey’s memo as reported by the Times said.
“He is a good guy,” Trump told Comey, according to the memo. “I
hope you can let this go.”
In the absence of any major economic data, this could be the
story that dominates markets on Wednesday.