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U.S. stocks looked set to open higher on Tuesday, after suffering a rough start to the new month and quarter as technology stocks struggled.
But worries over global trade conflict and about President Donald Trump’s plans, if any, for a clampdown on the tech sector were still sending a drumbeat of worry in the background.
Those fears helped push the S&P 500 through a key technical level on Monday, which could mean more weakness for stocks is on the way.
What are the main benchmarks doing?
Dow Jones Industrial Average futures YMM8, +0.18% rose 43 points, or 0.2% to 23,596, while S&P 500 futures ESM8, +0.33% added 8.75 points, or 0.3%, to 2,583.75. Nasdaq-100 futures NQM8, +0.38% were up 25.50 points, or 0.4%, to 6,419.75.
Led by selling for big technology names, U.S. stocks tumbled on Monday. The Dow DJIA, -1.90% finished down 458.92 points, or 1.9%, to 23,644.19. All 30 components were below their 50-day moving average, a sign that short-term momentum may be trending to the downside.
The S&P 500 SPX, -2.23% declined 2.2%, 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.
Meanwhile, the Nasdaq Composite Index COMP, -2.74% slid 2.7%. The tech-heavy index is down 0.5% for 2018 and nearing 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 President Donald Trump’s attacks on the online retailer, could continue Tuesday after Vanity Fair reported that he’s seeking ways to damage the company.
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.
Also: What struggled in the first quarter? Stocks, bonds, basically everything
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, Minnesota, 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
“The fears over a trade war continue to ripple through markets, dampening risk appetite and sending traders into the safety of lower risk assets,” said Hantec Markets analyst Richard Perry in a note. “There has been an early rebound for risk sentiment today as U.S. futures have bounced and the yen has unwound some of its gains of recent days, however, trade war fears never seem to be too far away at the moment.”
Which stocks are in focus?
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, +1.23% 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, -0.86% SXXP, -0.86% fell, following U.S. equities lower, as traders returned from a long holiday weekend.
Oil prices CLK8, +0.59% were modestly higher, while gold futures GCJ8, -0.42% slipped and the ICE U.S. Dollar Index DXY, -0.04% DXY, -0.04% was slightly lower.