US Stock Likely To Open Lower As US-China Tariff War Continues: 'Valuations Are Now Looking More Compelling,' Says Expert

U.S. stock futures declined on Wednesday following a muted day of trading on Tuesday. Futures of major benchmark indices were lower in premarket.

The Donald Trump administration levied a 245% tariff on China late Tuesday. “China now faces up to a 245% tariff on imports to the United States as a result of its retaliatory actions,” stated a White House fact sheet.

Meanwhile, the new U.S. export restrictions halting the shipments of Nvidia Corp.‘s (NASDAQ:NVDA) H20 graphics processing units to China were announced. The announcement comes after the U.S. government informed the company on April 9 that it would now require a license to export those chips.

The 10-year Treasury bond yielded 4.31% and the two-year bond was at 3.81%. The CME Group's FedWatch tool’s projections show markets pricing a 79.9% likelihood of the Federal Reserve keeping the current interest rates unchanged in its May meeting.

The SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust ETF (NASDAQ:QQQ), which track the S&P 500 index and Nasdaq 100 index, respectively, fell in premarket on Wednesday. The SPY was down 0.67% to $534.02, while the QQQ declined 1.27% to $452.17, according to Benzinga Pro data.

Cues From Last Session:

Weighing on U.S. stocks Tuesday, the consumer discretionary, health care, and consumer staples sectors saw the biggest declines.

Bucking the trend, however, information technology and real estate stocks closed higher.

The market moves came as Citigroup Inc. (NYSE:C) and Bank of America Corp. (NYSE:BAC) reported better-than-expected first-quarter earnings, while economic data showed a rise in the NY Empire State Manufacturing Index and flat export prices alongside a slight drop in import prices for March.

The Dow closed Tuesday 10.44% below its 52-week peak of 45,073.63. The S&P 500 ended 12.21% off its 6,147.43 high, and the Nasdaq 100 was 15.27% below its 22,222.61 record.

Insights From Analysts:

According to Mona Mahajan of Edward Jones, the stock valuations were ...

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