(Reuters) – U.S. stock index futures signaled a bounce on Tuesday, as China stepped in to steady the yuan and investors sought beaten-down stocks, a day after Wall Street’s main indexes racked up their steepest one-day percentage fall of the year.
FILE PHOTO: Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., August 5, 2019. REUTERS/Brendan McDermid
The benchmark S&P 500 .SPX and Nasdaq .IXIC lost at least 3% each on Monday, their sixth straight day of losses, as China let the yuan drop sharply in what was seen as a retaliation to President Donald Trump’s threat to slap a new round of tariffs on Chinese imports last week.
U.S. Treasury Department labeled Beijing a currency manipulator late on Monday, crushing any hopes of a swift resolution to the trade war.
“This trade spat is going away no time soon, but we should see central bank easing bets rise globally and that will help limit some of the market carnage over the next couple of weeks,” said Edward Moya, senior market analyst at Oanda in New York.
At 6:45 a.m. ET, Dow e-minis 1YMcv1 rose 0.85%. S&P 500 e-minis EScv1 advanced 0.91%, while Nasdaq 100 e-minis NQcv1 were up 80.75 points, or 1.09%.
Shares of technology companies, which have a big exposure to China, were higher in premarket trading.
Apple Inc (AAPL.O) edged 0.4% after three days of heavy losses, while shares of semiconductor companies – Intel Corp (INTC.O), Advanced Micro Devices Inc (AMD.O) and Nvidia Corp (NVDA.O) – rose between 1.2% and 1.7%.
Industrial bellwethers Boeing Co (BA.N) and Caterpillar Inc (CAT.N) rose about 1% each.
The latest streak of losses has pulled the S&P 500 about 6% away from its all-time high hit last month.
Among other stocks, Walt Disney Co (DIS.N) was up 1.2%. the company is set to report its third-quarter results after market close.
Reporting by Medha Singh in Bengaluru; Editing by Anil D’Silva