WASHINGTON (dpa-AFX) - Following the sell-off seen in the previous session, stocks are likely to see further downside in early trading on Wednesday. The major index futures are currently pointing to a lower open for the markets, with the Dow futures down by 141 points.
Trade concerns may continue to weigh on the markets, as news the U.S. plans to raise tariffs on Chinese goods as early as Friday has led to renewed worries about a trade war.
The threat of higher tariffs has led to concerns about global economic growth and the potential for higher costs to be passed on to U.S. consumers.
A report showing Chinese exports unexpectedly shrank 2.7 percent in April compared to a year earlier may add to the negative sentiment.
Trading activity may be somewhat subdued, however, as traders wait for news out of U.S.-China trade talks scheduled for the coming days.
A lack of major U.S. economic data on the day may also keep traders on the sidelines ahead of the release of reports on the U.S. trade deficit and producer and consumer prices.
Among individual stocks, shares of TripAdvisor (TRIP) are moving sharply lower in pre-market trading after the travel website reported better than expected first quarter earnings but on sales that missed estimates.
Money transfer company Western Union (WU) is also likely to see initial weakness after reporting first quarter results that missed expectations on both the top and bottom lines.
On the other hand, shares of Electronic Arts (EA) are seeing considerable pre-market strength after the video game publisher reported better than expected fiscal fourth quarter results.
After recovering from an initial sell-off on Monday, stocks showed a substantial move back to the downside during the trading day on Tuesday. With the drop on the day, the Dow fell to its lowest closing level in well over a month.
The major averages climbed well off their lows of the session going into the close but remained firmly negative. The Dow tumbled 473.39 points or 1.8 percent to 25,965.09, the Nasdaq plunged 159.53 points or 2 percent to 7,963.76 and the S&P 500 slumped 48.42 points or 1.7 percent to 2,884.05.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan's Nikkei 225 Index dropped by 1.5 percent, while Hong Kong's Hang Seng Index slid by 1.2 percent.
Meanwhile, the major European markets have turned mixed on the day. While the German DAX Index has risen by 0.3 percent, the French CAC 40 Index is down by 0.1 percent and the U.K.'s FTSE 100 Index is down by 0.3 percent.
In commodities trading, crude oil futures are inching up $0.13 to $61.53 a barrel after sliding $0.85 to $61.40 a barrel on Tuesday. Meanwhile, after rising $1.80 to $1,285.60 an ounce in the previous session, gold futures are climbing $6.50 to $1,292.10 an ounce.
On the currency front, the U.S. dollar is trading at 110.05 yen compared to the 110.26 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is valued at $1.1196 compared to yesterday's $1.1191.
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