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U.S. stock-index futures pointed to a modestly higher open on Tuesday, though caution and volatility were expected to remain elevated after a broad selloff in the previous session took the S&P 500 below a key technical level and erased the Nasdaq’s gains for the year.
President Donald Trump remained a key focus for the equity market, with investors wary of any trade actions he might announce—particularly after China retaliated to U.S. tariffs with protectionist measures of its own—as well as his feud with Amazon, which he has repeatedly criticized over Twitter in the past week. The technology sector, which led the market’s decline on Monday, will also remain at the forefront of Wall Street’s attention.
What are the main benchmarks doing?
Dow Jones Industrial Average futures YMM8, +0.61% rose 91 points, or 0.4% to 23,644, while S&P 500 futures ESM8, +0.69% added 12.50 points, or 0.5%, to 2,587.50. Nasdaq-100 futures NQM8, +0.96% were up 38 points, or 0.6%, to 6,431.25.
Monday’s selloff was broad-based and deep. Both the S&P and the Nasdaq shed more than 2%, with the S&P closing below its 200-day moving average for the first time since the United Kingdom’s vote for Brexit in June 2016. That closely watched technical level—which the Dow nearly closed below as well—is used to gauge long-term momentum. While the Dow DJIA, -1.90% held above that level, all 30 of its components were below their 50-day moving average, a sign that short-term momentum may be trending to the downside.
The Nasdaq Composite Index COMP, -2.74% turned negative for the year on Monday and neared correction territory, defined as a drop of at least 10% from a peak.
What’s driving markets
Investors will be on the lookout for volatility, which has been a hallmark of markets over the past few weeks. Despite the bumpy start to the month, April tends to be a strong month for stocks, including the strongest of the year for the Dow.
Don’t miss: Why stock investors should be welcoming the return of volatility
Tech stocks will likely remain on the radar, given they have been driving recent losses. Worries about Amazon.com Inc. AMZN, -5.21% given Trump’s attacks on the online retailer, could continue Tuesday after Vanity Fair reported that he’s seeking ways to damage the company. While Amazon is classified as a consumer-discretionary stock, it often moves on tech issues and it is part of the so-called group of “FAANG” names that drove markets higher in 2017 but have struggled more of late.
Read: Facebook is in bear market territory, Apple is in a correction, and they are far from alone
The trade situation, which has been knocking the stock market, should be another focus. China announced tariffs on about 130 U.S. goods over the weekend, in retaliation for the Trump administration’s planned tariffs on Chinese imports.
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There are no major economic data releases scheduled for Tuesday, though updates on vehicle sales should come in throughout the day.
As for Federal Reserve speakers, Minneapolis Fed President Neel Kashkari, who’s not a voting member this year on the Fed’s rate-setting board, is expected to take part in a moderated discussion at the Regional Economic Indicators Forum in Duluth, Minn., at 9:30 a.m. Eastern Time. Fed Gov. Lael Brainard is due to speak on financial stability at New York University at 4:30 p.m. Eastern.
Check out: MarketWatch’s Economic Calendar
What strategists are saying
“This is still a market trading on fear instead of fundamentals and on tweets instead of technicals, which has made it frustratingly difficult to figure out where we’re headed in the near term,” said Andrew Adams, an investment strategist at Raymond James. “There’s just not much positive news to help balance out the daily onslaught of fear-producing headlines about trade wars and tech crises, especially since we are currently in between earnings seasons.”
Read: Data, earnings set to wrest stock market’s attention from Facebook and trade
Which stocks are in focus?
The “FAANG” names—in addition to Amazon, this group includes Facebook FB, -2.75% Apple AAPL, -0.66% Netflix NFLX, -5.10% and Google-parent Alphabet GOOGL, -2.36% GOOG, -2.45% —will continue to be in focus after their sharp losses on Monday.
Read: Facebook is in bear-market territory as Apple flirts with a correction, and they are far from alone
Tesla Inc. TSLA, -5.13% could also see heavy trading following a 5.1% drop on Monday. Trading in the electric-car maker has been driven by uncertainty over the company’s ability to turn out as many Model 3 sedans as it has promised.
Walmart Inc. WMT, -3.84% may be active after CNBC reported the retailer is in talks to buy online pharmacy startup PillPack. That comes days after Walmart was reported to be in early talks to buy Humana Inc. HUM, +4.42%
21st Century Fox Inc. FOX, -1.90% shares may be active after the media company proposed separating Sky News from the rest of Sky PLC SKY, +2.00% to allay U.K. regulators’ concerns its bid to acquire the 61% of Sky it doesn’t already own. Fox also said Walt Disney Co. DIS, -1.77% has expressed interest in buying Sky News.
Spotify Technology Inc. SPOT, +0.00% is expected to make its trading debut on the New York Stock Exchange on Tuesday.
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What are other markets doing?
Asian stock markets NIK, -0.45% HSI, +0.29% closed lower, as tech stocks tracked U.S. losses Monday.European stocks SXXP, -0.36% SXXP, -0.36% also fell, as traders returned from a long holiday weekend.
Oil prices CLK8, +0.44% were modestly higher, while gold futures GCJ8, -0.22% slipped and the ICE U.S. Dollar Index DXY, -0.04% DXY, -0.04% clung to a thin gain.