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Wall Street is pointing down, dragged down by technology and social media

U.S. markets were on course to open in negative territory on Tuesday as concerns over lingering inflation outweighed optimism due to a remark by President Joe Biden suggesting he could cut U.S. tariffs on Chinese imports. Dow Jones industrial futures fell 0.7% while S&P 500 futures fell 1%.

Stocks in Asia ended lower and European benchmarks were lower at midday, a day after US markets started the week strong, led by technology stocks.

Biden, who announced a new economic and trade initiative with the region during a visit to Japan, confirmed to reporters that he plans to discuss punitive tariffs imposed on China under former President Donald Trump’s administration. with Treasury Secretary Janet Yellen once back in Washington. .

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I speak with the secretary when I get home. We are considering it, Biden said. The comments sparked optimism about the potential to ease tensions between the world’s two largest economies, but not all were convinced.

Talks of cutting tariffs on Chinese exports have already surfaced and the lack of concrete follow-up remains a disappointment for markets, said Yeap Jun Rong, market strategist at IG in Singapore.

Biden joined the leaders of Japan, Australia and India in Tokyo for a Quad Summit, or the Quadrilateral Security Dialogue, where Biden argued the world had a shared responsibility to do something about help the Ukrainian resistance against Russian aggression. The summit took place on the last day of Biden’s first trip to Asia as president.

European stocks fell midday, with France’s CAC 40 and Germany’s DAX both down 0.9% and Britain’s FTSE 100 down 0.2%. Investors are also watching the impact of the war in Ukraine on commodity prices and the possible hit to global economic growth from pandemic shutdowns in China.

Japan’s benchmark Nikkei 225 lost 0.9% to 26,748.14. Australia’s S&P/ASX 200 fell 0.3% to 7,128.80 and South Korea’s Kospi fell 1.6% to 2,605.87.

Hong Kong’s Hang Seng fell 1.8% to 20,112.10, while the Shanghai Composite fell 2.4% to 3,070.93. Investors fear that the US central bank may go too far in raising rates or act too quickly. This could slow business activity and potentially trigger a recession.

On Wednesday, investors will get a more detailed look at the Fed’s decision-making process with the release of minutes from the latest policy meeting.

Tech stocks that took off during the pandemic are now taking the brunt of the selloff thanks to their high prices. Casting a shadow, social media messaging platform Snap Inc. surprised investors with a warning Monday night.

Snap shares fell 30% after the CEO told employees the company would miss quarterly growth and revenue targets. Wall Street is trying to determine if Snap’s problems are isolated or if it’s a canary in the social media coal mine.

Meta Platforms, the parent company of Facebook, and Twitter both have their annual shareholders meeting this week and both were punished early on Tuesday. Meta is the biggest loser in the S&P, down 8%.

Twitter fell nearly 4% and Alphabet nearly 5%. Snap’s stock price fell more than 30% in extended trading after the CEO, in a memo to employees, said it would miss quarterly growth and revenue guidance,” Jeffrey said. Halley from Oanda in a comment.

In premarket trading, Snap shares fell $6.84, or nearly 31%, to $22.47, less than two hours before U.S. markets opened. Snap’s slide took social media with it early Tuesday, as Facebook parent Meta fell nearly 8% and Twitter nearly 4%.

Wall Street will receive some economic updates from the Commerce Department this week. On Thursday it will release a first-quarter gross domestic product report and on Friday it will release personal income and spending data for April.

In energy trading, benchmark U.S. crude gained 33 cents to $110.62 a barrel in electronic trading on the New York Mercantile Exchange. It added 1 cent to $110.29 a barrel on Monday.

Brent, the international price standard, rose 38 cents to $113.60 a barrel. In currency trading, the US dollar fell slightly to 127.34 Japanese yen from 127.78 yen. The euro traded at $1.0720, down from $1.0688 previously.

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