U.S. stock index futures were slightly lower Tuesday morning, after losses in the previous session fueled concerns about the state of the economy.
Market focus is largely attuned to selling in regional markets, after protests in Hong Kong and a crash in the Argentine peso drove investors to perceived ‘safe haven’ assets like bonds, gold and the Japanese yen.
These safe-haven assets are typically sought to limit one’s exposure to losses in the event of a sharp market downturn.
On Monday, the Dow slumped nearly 400 points to fall back below 26,000, while the benchmark 10-year Treasury yield dipped to 1.63%.
The spread between 2-year and 10-year Treasury yields narrowed to only 6 basis points on Monday, near its lowest level since 2007.
Market sentiment was already fragile due to increasing signs that the world’s two largest economies are unlikely to quickly resolve their protracted trade war. The U.S. and China will resume trade negotiations in Washington in early September.
On the data front, the latest NFIB small business optimism survey for July will be released at 6:00 a.m. ET. Annualized and monthly Consumer Price Index (CPI) and core CPI data for July will be released slightly later in the session.