Stocks are set to tank after Wall Street-friendly Cohn resigns

U.S. stock index futures pointed to a sharply lower open on Wednesday after news that White House chief economic advisor Gary Cohn has resigned.

Dow Jones industrial average futures indicated a drop of more than 300 points at the open, while the S&P 500 futures implied a decline of about 1 percent. Industrials stocks Caterpillar and Boeing fell more than 2 percent in extended trading.

Cohn, former Goldman Sachs president and COO, was seen as supporting more business-friendly policies, so his resignation was especially jarring in the wake of President Donald Trump's surprise announcement of tariffs on steel and aluminum imports on Thursday.

The SPDR S&P 500 ETF Trust (SPY) fell roughly 1 percent in premarket trading.

"I think this is definitely a bigger deal than some of the other departures, due to Cohn's reputation as proponent of Wall Street, said Dan Deming, managing director at KKM Financial. "Short-term I believe it would increase concerns of an increased probability of a trade war escalating."

However, he and other analysts noted that it was too early to determine whether there will be lasting damage to market psychology.

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