Stocks open lower ahead of Trump’s Iran nuclear deal decision

Big 5

U.S. stocks opened lower on Tuesday as Wall Street braced for President Donald Trump’s announcement on whether he will pull the United States from the Iran nuclear deal signed three years ago.

The Dow Jones industrial average fell 28 points, with Disney as the worst-performing stock in the index. The S&P 500 declined 0.1 percent as utilities fell 0.7 percent. The Nasdaq composite slipped 0.1 percent.

At 2 p.m. ET, Trump will announce whether the U.S. will waive oil export sanctions on Iran. Back in 2015, the Obama administration signed a deal with the Middle Eastern nation to defer those sanctions, while Iran curbed its nuclear program.

“There are a number of options available for [Trump] and the market is interested in seeing which one he takes,” said Quincy Krosby, chief market strategist at Prudential Financial. “That could preview how he deals with other foreign policy matters such as North Korea.”

Trump has threatened numerous times to withdraw the U.S. from the Iran deal unless allies in Europe amend what he sees as shortcomings of the agreement.

In spite of the Trump’s threats to pull out, Iran President Hassan Rouhani has stated that Iran had a plan to counter any move made by Trump when it comes to the deal.

“Allowing Iran to produce nuclear fuel again would further boost the dollar and lower UST yields,” said Komal Sri-Kumar, president of Sri-Kumar Global Strategies, in an email. “The US withdrawal from Iran the treaty would be another step in isolating the US from rest of the world.”

U.S. Treasury yields rose slightly on Tuesday, while the dollar climbed 0.4 percent against a basket of currencies. Crude prices fell ahead of the announcement. West Texas Intermediate futures traded about 1 percent lower at $70.03 per barrel.

Equities closed off their session highs on Monday after Trump tweeted the announcement was coming. The major averages were propelled to their highs by energy stocks, which rose more than 2 percent on Monday before closing slightly higher.

In corporate news on Tuesday, sources told CNBC that NBCUniversal-parent Comcast is planning an all-cash bid for most of 21-Century Fox’s assets if the U.S. government approves AT&T’s purchase of Time Warner. Comcast shares slipped 2 percent, while Fox rose 2.5 percent.

In central bank news, Fed Chair Jerome Powell delivered remarks in Zurich Tuesday. At the Swiss National Bank and International Monetary Fund’s High Level Conference, the chair of the U.S. central bank said that the Fed’s interest rate hikes may not end up having as great of a risk on emerging market economies and stock markets as many had initially thought.

Powell added that the central bank would however continue to communicate its policies clearly, to avoid market disruptions.