U.S. stock futures indicated losses for Wall Street on Tuesday, as fresh concerns over the state of the global economy and grade were set to greet investors returning from the long holiday weekend.
Earnings will also swing into focus, with a busy week ahead.
How are the benchmarks trading?
Contents
Dow Jones Industrial Average futures
fell 193 points, or 0.8%, to 24,495, while S&P 500 futures
dropped 20.85 points, or 0.8%, to 2,650.50. Nasdaq-100
futures fell 68.25 points, or 1%, to 6,725.
Stocks closed higher for the fourth-straight session on Friday. The Dow Jones Industrial Average
rose 336.25 points, or 1.4%, to end at 24,706.35 for a weekly gain of 3%. The S&P 500 index
advanced 1.3% to 2,670.71, up 2.9% for the week. The Nasdaq Composite
added 1% to 7,157.23, finishing out the week 2.7% higher.
What’s driving markets?
After the country posted the slowest annual pace of annual growth — 6.6% — since 1990, President Xi Jinping reportedly convened a meeting of high-level Communist Party officials, urging them to be alert over “black swan” and “grey rhino” financial events in face of an economic slowdown. Trade tensions are partly to blame for the weak data.
Read: On trade, China’s private-equity king is ‘hopeful for the best, prepared for the worst’
Citing that weak data, President Donald Trump tweeted late Monday that China needs to “finally do a Real Deal and stop playing around,” when it comes to trade. But the two countries reportedly remain far apart on key issues such as theft of intellectual property, which the U.S. says China has engaged in for decades.
China posts slowest economic numbers since 1990 due to U.S. trade tensions and new policies. Makes so much sense for China to finally do a Real Deal, and stop playing around!
— Donald J. Trump (@realDonaldTrump) January 21, 2019
On Saturday, Trump said stock-rallying reports last week that the U.S. would ease tariffs on China were not correct, even as he said talks were “going very well.”
Potentially adding to trade tensions was a report that the U.S. plans to formally request from Canada the extradition of Huawei’s chief financial officer, Meng Wanzhou, over allegations she lied about the company’s dealings with Iran.
Meanwhile, on Monday, the International Monetary Fund cut its global growth forecast to 3.5% for 2019, from 3.7% in 2018 and from the 3.7% it predicted for 2019 back in October. Unveiling its forecasts at the World Economic Forum in Davos, Switzerland, the fund left its prediction for U.S. growth this year unchanged at 2.5%.
A partial government shutdown stretched into its 31st day on Monday, and there was little sign of the deadlock breaking. Democrats rejected Trump’s latest proposal to temporarily extend protections for young immigrants brought to the country illegally in exchange for $5.7 billion for his border wall.
The shutdown has caused a backlog of economic data, with only a smattering of reports due this week, including existing home sales, jobless claims and Markit manufacturing and services purchasing managers index data.
Opinion: These 3 leading economic indicators show no recession is coming
On the earnings front, Johnson & Johnson
, IBM Corp.
and Advanced Micro Devices Inc.
will all report Tuesday.
IBM earnings: Emerging tech expected to account for half of sales as revenue declines
And: Tech is ready to respond to Wall Street’s doubts, but don’t expect a holiday miracle
How are other markets trading?
Trade and growth worries weighed on Asia markets, with the Shanghai Composite Index
sliding 1.4%. In Europe, stocks were hinting of opening losses at the start of trading.
Crude oil
dropped nearly 1% to $53.29 a barrel, while gold
slipped 0.3% to $1,278.40 an ounce and the U.S. dollar
was unchanged.
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