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* Salesforce falls after slashing profit, revenue outlook
* Trump expected to hold news conference on Friday
* Fed Chair Powell to speak at a public webcast
* Futures: Dow falls 0.59%, S&P slips 0.38%, Nasdaq flat (Adds comment, details; updates prices)
By Medha Singh
May 29 (Reuters) - The S&P 500 and the Dow were set to open lower on Friday as investors braced for a U.S. response to China’s national security law on Hong Kong, threatening to take the shine off another month of strong gains for Wall Street.
President Donald Trump is due to make an announcement later in the day and has vowed a tough response to China’s move, which many fear could erode some of the U.S. economic privileges that Hong Kong enjoys.
U.S. stocks sold off in the closing hours of Thursday’s session as worries about worsening relations between the world’s two biggest economies and an expected executive order related to social media companies weighed on the sentiment.
“If Trump decides to proceed with mild action, like travel and/or financial sanctions on Chinese officials, we don’t expect equities to tumble much,” said Charalambos Pissouros, Cyprus-based senior market analyst at JFD Group.
“In case the U.S. response is a bolder one, like scrapping the ‘Phase One’ trade deal and/or imposing fresh tariffs, the slide in risk assets could be larger, bringing into question further recovery in the broader sentiment.”
Hopes of a quick post-pandemic economic recovery have driven the S&P 500 to a near three-month-high as it heads for its second straight month of gains.
A day after Trump signed the order threatening social media firms with new regulations over free speech, Twitter Inc hid a tweet from the President and accused him of breaking its rules by “glorifying violence”.
Twitter shares were down 0.8% in premarket trading.
At 8:32 a.m. ET, Dow e-minis were down 151 points, or 0.59%. S&P 500 e-minis were down 11.5 points, or 0.38% and Nasdaq 100 e-minis were up 2.25 points, or 0.02%.
Focus is also on Federal Reserve Chair Jerome Powell who will speak in a public webcast, where he is expected to detail the central bank’s next phase of coronavirus response. The event is slated to start at 11:00 a.m. ET (1500 GMT).
Among stocks, Salesforce.com Inc slipped 3.4% as the cloud-based business software maker cut its annual revenue and profit forecasts.
Technology-focused companies Facebook Inc, Amazon.com Inc and Netflix Inc rose between 0.7% and 0.9%, after their rally lost steam in late May. (Reporting by Medha Singh in Bengaluru; Editing by Anil D’Silva and Saumyadeb Chakrabarty)