Lower open expected for the U.S markets Wednesday after the U.S. bond market flashed some warning signals about the U.S. economy triggering worries of a looming recession.

The fall of the yield curve on the 10-year Treasury note below the 2-year rate on Wednesday hinted at the risk of an impending economic slowdown.

Around 6:30 a.m. ET, Dow Jones futures indicated a negative open of nearly 300 points. The S&P and Nasdaq futures also looked lower.

China’s weaker-than-expected data for July published on Wednesday showed its industrial output growth crashed to 4.8 percent in July compared to last year and indicated the faltering demand in the country.

The USTR on Tuesday announced that certain products including clothing and cell phones will be removed from the tariff list under “health, safety, national security, and other factors” and will be spared from the additional tariffs of 10 percent.

Other tariffs will be deferred to Dec. 15 from Sep. 1 for certain articles, it said.

President Donald Trump defended the move and said it was meant to avoid disruption during holiday shopping ahead of the Christmas season.

Meanwhile, the European stocks traded lower Wednesday as weak GDP data from Germany and the eurozone dampened the investor sentiment. The pan-European Stoxx 600 fell 0.6 percent by mid-morning.

Oil price down

Oil prices fell on Wednesday after disappointing economic data from China and a build-up of the U.S. crude inventories unleashed worries of shrinking demand.

The oil price had made gains in the previous session after the U.S. said it would delay tariffs on Chinese products.

New data from the American Petroleum Institute (API) showed U.S. crude stocks had an unexpected surge last week.

Brent crude fell 0.8 percent at $60.84 a barrel at 0639 GMT, after rising 4.7 percent on Tuesday, the biggest percentage gain since December.

The U.S. oil index WTI fell 1.1 percent at $56.48 a barrel after an impressive 4 percent jump in the previous session.

The U.S crude inventories jumped by 3.7 million barrels to 443 million, crossing analyst expectations of a decrease of 2.8 million barrels, the API said.

China’s weak data for July showed industrial output growth has plunged to a 17-year low, underlining economic cracks coming from the year-long trade war with the United States.

Asia markets up

Stocks in the Asia Pacific moved up Wednesday after the U.S paused implementation of tariffs on some Chinese goods.

China shares jumped. The Shanghai Composite gained 0.42 percent.

Hang Seng index in Hong Kong was fractionally lower as the city remained tense and airport disruptions continued on Tuesday.

Japan’s Nikkei 225 rose 0.98 percent while the Topix index advanced 0.87 percent. The Kospi in South Korea gained 0.65 percent, while Australia’s ASX 200 rose 0.42 percent.  GettyImages-Stock market April 18 Traders work on the floor of the New York Stock Exchange (NYSE) on March 25, 2019 in New York City. Photo: Photo by Spencer Platt/Getty Images

In stock market news, gains by Indian shares were also prominent. On Wednesday, the benchmark BSE Sensex 30 jumped 377.74 points or 1.02 percent while the Nifty50 surged 105.80 points or 0.96 percent.

Gold price falls

Gold prices fell on Wednesday after the United States delayed tariffs on Chinese imports. The slight ease in trade tensions despite global growth concerns curtailed the appeal of the safe-haven metal.

Spot gold was down 0.1 percent at $1,499.89 per ounce, as of 0716 GMT. The U.S. gold futures slid 0.2 percent at $1,510.80 an ounce.

John Sharma, an economist with National Australia Bank said the outlook on gold price remains good. The analyst counts that the U.S Fed may go for one more rate cut, plus Hong Kong tensions, unresolved trade war, and trends in global growth will support gold prices.