Wall Street was poised for a lower opening on Monday as a decision by the United States to impose special duties on Chinese tires sparked investor concerns about a possible trade dispute.
The decision by U.S. President Barack Obama could open the door to a host of trade complaints against Chinese products, creating tensions as Western nations seek the support of the world's third-largest economy at G20 meetings later this month.
In response, China's commerce ministry said Sunday it launched an anti-dumping investigation into imports of U.S. chicken products and vehicles.
You don't want to be messing with your biggest trading partner who holds most of your debt, said Joe Saluzzi, co-manager of trading at Themis Trading in Chatham, New Jersey.
(The economy) is still teetering on all sorts of edges here. Something like this could be the spark that sends us lower.
S&P 500 futures fell 7.6 points and were below fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures dropped 60 points, and Nasdaq 100 futures shed 11.75 points.
On the merger-and-acquisition front, Sprint Nextel Corp
British confectioner Cadbury Plc
Kraft shares slipped 0.1 percent to $26.07.
Johnson & Johnson
The U.S. tariff plan helped lift shares of U.S. tire makers, with Goodyear Tire & Rubber Co
Investors have become increasingly wary of stock valuations after the current rally extended into its sixth month with the S&P 500 up 54 percent since the March 9 low.
The dollar gained against most currencies on Monday as the trade spat triggered a decline in global stocks. The dollar index <.DXY> was at 77, up 0.5 percent.
Morgan Stanley raised its forecast for U.S. crude oil price to $105 a barrel from $95 for 2012 due to tightening spare capacity. It expects global spare production capacity to stay ample through the end of 2010, before declining in 2011 and by 2012 reaching the similar tightness of 2007-08. Crude futures fell 0.6 percent.
Obama will attempt to revive a stalled push for stricter oversight of Wall Street on Monday, using the anniversary of Lehman Brothers Holdings Inc's
(Reporting by Chuck Mikolajczak; editing by Jeffrey Benkoe)