US STOCKS-Futures dip after rally as trade talk euphoria fades

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* Futures off: Dow and S&P 0.12%, Nasdaq 0.20%

By Shreyashi Sanyal
July 2 (Reuters) - U.S. stock index futures edged lower on
Tuesday, a day after the benchmark S&P 500 index hit a record
high, as optimism over progress in U.S.-China trade talks
subsided and a fresh threat of tariffs on Europe kept investors
on edge.
Adding to the downbeat mood was a clutch of discouraging
manufacturing surveys in the past 24 hours from around the world
that once again stoked fears of a global economic slowdown.
U.S. markets rose on Monday as Washington and Beijing agreed
to resume trade talks and President Donald Trump offered
concessions including no new tariffs and an easing of curbs on
Huawei Technologies Co Ltd HWT.UL . Washington threatened to slap tariffs on $4 billion of
additional EU goods, ratcheting up pressure on Europe in a
long-running dispute over aircraft subsidies.
With EU-U.S. trade tensions resurfacing, the way the
U.S.-China trade dispute is being solved gives some guidance on
how the United States is dealing with other trading partners,
said Florian Hense, an economist at Berenberg in London.
At 7:19 a.m. ET, Dow e-minis 1YMcv1 were down 32 points,
or 0.12%. S&P 500 e-minis EScv1 were down 3.5 points, or 0.12%
and Nasdaq 100 e-minis NQcv1 were down 15.25 points, or 0.2%.
The S&P 500 and the Dow Jones indexes posted their best June
performance in decades, on hopes that the Federal Reserve would
cut interest rates to preserve a decade-long U.S. expansion,
after a breakdown in trade talks sent markets into a tailspin in
May.
Market participants still expect a rate cut by the Fed of at
least a quarter of a percentage point at its July 30-31 policy
meeting, despite the latest developments in trade talks.
Among stocks, Western Digital Corp WDC.O fell 3% in
premarket trading after Benchmark cut its rating on the
hard-disk drive maker's stock to "sell."
Coty Inc COTY.N dropped 2.5% as multiple brokerages cut
price targets on the cosmetics maker's shares, a day after the
company said it would restructure and write down about $3
billion in value of brands acquired from Procter & Gamble Co
PG.N .