Dow Jones Industrial Average (DJIA) futures indicate a weak open on Wall Street on Tuesday. After the Labor Day weekend, which saw a fresh round of tariffs imposed on China, traders are returning to a bleak stock market and a host of recession warnings.
Fears of a downturn, triggered by the prolonged US-China trade war, saw the Dow collapse 2 percent in August. The trend looks set to continue through September as nine recession warnings flash red. According to CNBC, everything from the bond market to corporate earnings to manufacturing points to a downturn.
Dow Jones Industrial Average (DJIA) futures shed more than 200 points in early trading Tuesday. At 6.58 am ET, Dow futures were 217 points lower, pointing to a weak stock market open.
As CCN.com extensively reported, whispers of the ‘r’ word have been circulating for several months on Wall Street, forcing the Dow and S&P 500 down. But we’re fast reaching fever pitch. CNBC highlights at least nine recession indicators to watch right now.
With so much talk of recession and negative sentiment, contrarians will likely see this dip in the Dow Jones as a buying opportunity. Fundstrat’s Thomas Lee believes the market weakness will force the Federal Reserve’s hand into cutting rates in September. A move he sees as bullish for stocks.
“We see a falling 10-yr [bond yield] and weakening USD and higher odds of a September cut as VERY BULLISH—hence, we strongly urge investors to take advantage of this weakness.”
This article was updated at 6.59 am ET to reflect updated prices.
Last modified: June 23, 2020 2:34 PM UTC