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US STOCKS-Wall St to open lower on Trump's healthcare bill setback
March 27, 2017 / 12:50 PM / 9 months ago

US STOCKS-Wall St to open lower on Trump's healthcare bill setback

* Congress pulls healthcare bill on Friday

* Trump says to turn attention to tax cuts

* Bank stocks, dollar drop; gold hits one-month high

* Futures down: Dow 144 pts, S&P 19.75 pts, Nasdaq 40 pts (Adds details, comments, updates prices)

By Yashaswini Swamynathan

March 27 (Reuters) - Wall Street was set to open lower on Monday after the defeat of President Donald Trump’s healthcare reform bill cast doubts over his ability to deliver on his agenda of tax cuts and simpler regulations.

In a stunning setback, Congress controlled by Trump’s Republican party pulled a bill to overhaul the Affordable Care Act, or Obamacare, on Friday. The bill was Trump’s first major legislative move since taking office in January.

“The markets around the globe are falling as a rethinking of the ‘Trump Trade’ begins to focus on reality,” Peter Cardillo, chief market economist at First Standard Financial in New York, wrote in a note.

“While we don’t expect a full-blown correction to commence at this time, we do see rising negative sentiment replacing the ‘Hope Trade’.”

The dollar, which had found favor on the possibility of tax cuts and higher infrastructure spending, hit its lowest since Nov. 11, while prices of safe-haven gold shot up to one-month highs.

Banks, which had outperformed in the post-election rally on bets of simpler regulations and higher inflation, were down between 1.7 and 2.3 percent in premarket trading on Monday.

Still, losses in futures appeared to be kept in check on Trump’s comment to turn his attention to getting “big tax cuts” through Congress.

Dow e-minis were down 144 points, or 0.7 percent at 8:25 a.m. ET (1225 GMT), with 41,266 contracts changing hands.

S&P 500 e-minis were down 19.75 points, or 0.84 percent, with 236,560 contracts traded.

Nasdaq 100 e-minis were down 40 points, or 0.74 percent, on volume of 43,598 contracts.

Investors will look forward to comments from Chicago Federal Reserve President Charles Evans and his Dallas counterpart, Robert Kaplan, for clues on the timing of the next interest rate hike.

Fed Chair Janet Yellen is scheduled to speak at a conference on Tuesday in Washington.

Snap Inc was up 4.7 percent at $23.80 in premarket trading on Monday after multiple brokerages began coverage on the owner of Snapchat after the blackout period for its IPO underwriters ended. was off 0.8 percent at $837.50 after Dubai’s Emaar Malls made an $800 million offer for online retailer Amazon has agreed in principle to buy Souq, according to sources.

Steel stocks, including AK Steel and United States Steel, were down about 4 percent.

Cal-Maine Foods slumped 9 percent to $34 after the company’s third-quarter sales missed analysts’ expectations. (Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Anil D‘Silva)

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