By Sruthi Shankar
(Reuters) - Wall Street was set to start the second quarter on a downbeat note on Monday as China's decision to raise import tariffs on U.S. products revived global trade war fears and technology stocks remained under pressure.
Nasdaq futures pointed to a 0.8 percent decline at the open as big names including Facebook and Amazon slipped in premarket trading.
China, late on Sunday, said it would increase tariffs by up to 25 percent on 128 U.S. products, escalating a spat between the world's biggest economies. The move came in response to U.S. duties on imports of aluminum and steel.
"That's going to start stoking fears of trade wars and protectionism. The market doesn't really like that," said Andre Bakhos, managing director at New Vines Capital LLC in Bernardsville, New Jersey.
"And if it escalates, the questions could be on if China is going to buy our bonds. We have speculation out there, but it could be some profit taking and some risk-off mentality for the moment."
U.S. President Donald Trump is separately preparing to impose tariffs of more than $50 billion targeting "largely high-technology" Chinese products.
At 8:33 a.m. ET, Dow e-minis were down 138 points, or 0.57 percent, with 33,657 contracts changing hands.
S&P 500 e-minis were down 11.75 points, or 0.44 percent, with 102,321 contracts traded.
Nasdaq 100 e-minis were down 54.25 points, or 0.82 percent, on volume of 39,975 contracts.
Amazon fell 1.5 percent after Trump launched his second attack over the weekend, accusing the world's biggest online retailer of getting unfairly cheap rates from the U.S. Postal Service and not paying enough tax.
Facebook fell 0.8 percent as the data scandal last month continued to weigh. On Monday, brokerage Pivotal Research slashed its price target, citing a faster-than-expected deceleration in the social media company's revenue growth.
Hit by concerns about a possible trade war, rising interest rates and valuations in the technology sector, the S&P 500 and the Dow Jones Industrial Average posted their worst declines in more than two years in the quarter ended March.
Nervous investors are hoping an unusually strong U.S. earnings season can restore some of the optimism that characterized equity markets last year.
Tesla shares fell about 4 percent after the electric car maker said the Model X vehicle that recently crashed was on Autopilot and also announced a recall.
Humana rose about 6 percent after a report that Walmart was in early-stage talks with the health insurer about developing closer ties, with acquisition discussed as one possibility. Walmart declined more than 1 percent.
(Reporting by Sruthi Shankar in Bengaluru; Editing by Sriraj Kalluvila)
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