Wall Street set to open lower on recession fears

• The S&P 500 saw its worst first-half percentage decline since 1970.
• The Nasdaq 100 e-minis were down 145.75 points at the opening of trading on Tuesday.
• premarket declines for the mega-cap growth companies Alphabet and Microsoft from 1.2% to 1.6%.

Investors worried about the risk of an economic recession as central banks across the world adopt aggressive measures to prevent an increase in inflation were expected to sell off U.S. stock indices at the opening on Tuesday.

The blazing bull market of recent years has come to an end as the Federal Reserve transitions away from easy-money policies by increasing borrowing costs, causing the benchmark S&P 500 index (.SPX) to see its worst first-half percentage decline since 1970.

Traders are currently preparing for an additional 75 basis point increase at the month’s conclusion.

As trading resumes following a holiday weekend and with the earnings season just a few weeks away, investors will also analyse economic data and company commentary for indications of peaking inflation and slowing economic growth.

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The market is dominated by recession worries, according to Sam Stovall, chief investment strategist at CFRA.

“The key query is how much the second-quarter results or outlook will fall short of expectations if the economy is faltering. The public is anticipating news that could act as a spark.”

Data released on Tuesday revealed that the euro zone’s corporate expansion slowed down even further in January, and indicators pointed to a possible decrease this quarter as consumers remain cautious due to the cost of living problem. View More

According to a study from the U.S. Commerce Department, manufacturing orders likely increased by 0.5 percent in May as opposed to 0.3 percent in April. At 10:00 a.m. ET, or 1400 GMT, the data is due.

A major area of the yield curve abruptly inverted on Tuesday, highlighting market worries about a future U.S. economic recession as ten-year U.S. Treasury yields increased.

The premarket declines for the mega-cap growth companies Alphabet Inc (GOOGL.O), Microsoft Corp (MSFT.O), and Amazon.com (AMZN.O) ranged from 1.2 percent to 1.6 percent.

At 8:23 a.m. ET, the Nasdaq 100 e-minis were down 145.75 points, or 1.26 percent, while the S&P 500 e-minis were down 40.5 points, or 1.06 percent. The Dow was down 308 points, or 0.99 percent, at the same time.

Due to supply-chain issues, Tesla Inc.’s second-quarter electric vehicle deliveries decreased as compared to the prior quarter, which caused the company’s shares to drop 1.9 percent.

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