Futures Decline: Harris Discusses US Steel-Nippon Steel Bid

Stock futures on Wall Street indicate a lower opening for September after an eventful August marked by significant deal-making activity. In political news, Kamala Harris announced her intention to block a proposed takeover of U.S. Steel by Japan’s Nippon Steel during a campaign event in Pennsylvania, a key state for the upcoming presidential election. Additionally, Tesla is reportedly planning to introduce a six-seat variant of its Model Y in China to enhance its appeal in that competitive automotive market.

1. Futures Point Lower

U.S. stock futures were slightly down on Tuesday as the market prepares for a new trading month following a volatile August. By 08:59 GMT (04:59 EST), the Dow had dropped 123 points, approximately 0.3%, the S&P 500 had decreased by 21 points, or 0.4%, and the Nasdaq had fallen by 72 points, also a 0.4% decline.

The main indices in the U.S. were closed on Monday for the Labor Day holiday. On the last trading day before the holiday, they had posted gains, concluding August positively despite a rocky start fueled by recession concerns. The benchmark index decreased over 7% early in the month but rebounded to finish with a 2.3% rise in August, marking its fourth consecutive monthly gain. The Dow Jones and the Nasdaq also experienced increases of 1.8% and 0.7%, respectively, during that time.

2. Harris Opposes U.S. Steel-Nippon Steel Deal

Democratic presidential candidate Kamala Harris expressed her opposition to a proposed $14.9 billion acquisition of U.S. Steel by Japan’s Nippon Steel. Speaking to supporters in Pennsylvania, Harris emphasized that U.S. Steel is a "historic American company" that should remain under American ownership and operation.

Her stance resonates with previous comments from President Joe Biden and aligns with the views of her Republican opponent, Donald Trump, who has also pledged to block the acquisition. The bipartisan pushback against the deal mirrors concerns raised by the United Steelworkers union regarding the potential impacts on national security and domestic employment. Despite this opposition, both U.S. Steel and Nippon Steel have advocated for the merger, claiming it would benefit the U.S. steel sector.

3. Tesla to Launch Six-Seat Model Y in China

Tesla is reportedly gearing up to produce a new six-seat version of its Model Y, aiming for a launch in China by late 2025. This initiative is part of the company’s broader strategy to refresh its top-selling electric vehicle and enhance its appeal amid rising competition from local EV makers.

Tesla has reportedly informed suppliers to prepare for a significant ramp-up in Model Y production at its Shanghai facility. Although details about the production increase haven’t been publicly disclosed, Tesla is awaiting approval for an expansion on a nearby 70-hectare plot of land. The company has already experienced a 6% year-on-year rise in deliveries of the Model 3 in the first half of the year, following an updated model release, and reported a 37% sales increase in August compared to July.

4. Brazil’s President Supports X Ban

Brazilian President Luiz Inácio Lula da Silva has endorsed a contentious ruling by the country’s Supreme Court to uphold a ban on the social media platform X, previously known as Twitter. Lula stated that the world should not tolerate what he described as Elon Musk’s far-right ideology simply due to his wealth.

On Monday, a group of judges unanimously upheld the ban after a Supreme Court Justice cited non-compliance with hate speech regulations. Musk criticized the ruling on X, labeling the judge a "dictator." Investor concerns have also been raised regarding the court’s decision to freeze bank accounts belonging to Musk’s Starlink broadband service due to unpaid fines related to judicial orders.

5. Crude Prices Mixed

Crude oil prices showed mixed results on Tuesday as traders assessed sluggish economic growth in China, the world’s largest crude importer, alongside the interruption of production and exports from Libya. By 03:15 ET, the Brent crude contract slipped by 0.1% to $77.42 per barrel, while West Texas Intermediate (WTI) climbed by 0.2% to $74.17 a barrel, as it had not settled on Monday due to the U.S. holiday.

Data released over the weekend indicated that China’s purchasing managers’ index reached a six-month low in August, suggesting weakening demand from the country. Conversely, the cessation of oil exports at major Libyan ports and a reduction in production provided some upward pressure on oil prices.