Stocks are seen opening sharply lower Wednesday, with S&P500 futures falling with Asian and European stocks overnight as the U.S.-China trade war rumbles on.
Bond yields fell to multi-year lows and crude oil prices slumped also, while the U.S. dollar and gold rose.
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Investors view the plunge in bond yields as a sign global economic growth is slowing as the trade war begins to disrupt supply lines and raise prices for companies and consumers, with the full impact of American tariffs yet to be felt.
| Ticker | Security | Last | Change | %Chg |
|---|---|---|---|---|
| I:DJI | DOW JONES AVERAGES | 25175.59 | -172.18 | -0.68% |
| SP500 | S&P 500 | 2802.39 | -23.67 | -0.84% |
| I:COMP | NASDAQ COMPOSITE INDEX | 7607.350732 | -29.66 | -0.39% |
The Dow Jones Industrial Average is seen likely to add to its 4.7 percent decline so far in May. The 10-year U.S. Treasury note yield, which fell to a 19-month low on Tuesday, fell again to a new around 2.24 percent early Wednesday.
The U.S. and China have imposed tariffs on billions of dollars’ worth of each others imports since the start of 2018, undermining business confidence and potentially disrupting complex global production chains.
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In the latest move, Chinese state media this week raised the possiblity of limiting the export of rare earth minerals which are key to the manufacture of high technology. China supplies about 80 percent of the world’s rare earth minerals. Semiconductor makers in particular would be affected by a ban on such exports.
In commodities markets, U.S. West Texas Intermediate crude oil fell 2.6 percent overnight to $57.55 per barrel, while gold prices and the U.S. dollar edged higher.
