Following the sell-off seen in the previous session, stocks may see some further downside in early trading on Thursday. The major index futures are currently pointing to a lower open for the markets, with the Dow futures down by 76 points.
Concerns about President Donald Trump's ability to implement his pro-business policy agenda may generate continued selling pressure following a recent string of damaging news.
Buckling to outside pressure, Deputy Attorney General Rod Rosenstein announced the appointment of former FBI Director Robert Mueller to serve as Special Counsel to oversee the investigation of Russian meddling in the presidential election.
Rosenstein said public interest requires him to place the investigation under the authority of a person who exercises a degree of independence from the normal chain of command.
The move comes on the heels of reports Trump asked former FBI Director Comey to drop a federal investigation into links between former National Security Adviser Michael Flynn and Russia.
A notable decline by shares of Cisco Systems (CSCO) may also weigh on the markets, with the networking giant moving sharply lower in pre-market trading after reporting better than expected fiscal third quarter results but providing disappointing guidance.
Chinese e-commerce giant Alibaba (BABA) may also see early weakness after reporting fiscal fourth quarter earnings that came in below analyst estimates.
Retail giant Wal-Mart (WMT) reported better than expected first quarter earnings, although its sales for the quarter came in below expectations.
Upbeat economic news may limit the downside for the markets, however, with a report from the Labor Department showing another unexpected drop in initial jobless claims in the week ended May 13th.
The report said initial jobless claims edged down to 232,000, a decrease of 4,000 from the previous week's unrevised level of 236,000. Economists had expected jobless claims to rise to 240,000.
A separate report from the Philadelphia Federal Reserve showed that regional manufacturing activity has unexpectedly expanded at a faster pace in the month of May.
The Philly Fed said its index for current manufacturing activity in the region climbed to 38.8 in May from 22.0 in April, with a positive reading indicating growth. The index had been expected to dip to 19.5.
Shortly after the start of trading, the Conference Board is scheduled to release its report on leading economic indicators in the month of April. The leading economic index is expected to rise by 0.3 percent.
After turning in a lackluster performance on Tuesday, stocks moved substantially lower during trading on Wednesday. With the steep drop on the day, the tech-heavy Nasdaq pulled back well off yesterday's record closing high.
The major averages saw further downside going into the close, ending the session near their worst levels of the day. The Dow tumbled 372.82 points or 1.8 percent to 20,606.93, the Nasdaq plunged 158.63 points or 2.6 percent to 6,011.24 and the S&P 500 slumped 43.64 points or 1.8 percent to 2,357.03.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Thursday. Japan's Nikkei 225 Index slumped by 1.3 percent, while Hong Kong's Hang Seng Index slid by 0.6 percent.
The major European markets have also moved to the downside on the day. While the U.K.'s FTSE 100 Index has tumbled by 1.3 percent, the French CAC 40 Index is down by 1 percent and the German DAX Index is down by 0.8 percent.
In commodities trading, crude oil futures are sliding $0.61 to $48.46 a barrel after climbing $0.41 to $49.07 a barrel on Wednesday. An ounce of gold is trading at $1,258.30, down $0.40 from the previous session's close of $1,258.70. On Wednesday, gold jumped $22.30.
On the currency front, the U.S. dollar is trading at 110.81 yen compared to the 110.83 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.1108 compared to yesterday's $1.1159.
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