Global Stocks Mixed Amid Concern Tech Stock Slide to Continue; Tesla Set to Fall - Barron's

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A motorcyclist rides by the Tesla Fremont Factory on May 12, 2020 in Fremont, California.

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Stocks were sliding in premarket trading Tuesday, signaling what could be a volatile week in trading after the long holiday weekend. Tech stocks continued to tumble as some of the highflying names that gained ground in recent months lost some of their luster with investors. Wall Street also weighed continuing tensions between the U.S. and China, after President Trump said on Monday that he was considering “decoupling” from the country.

Futures for the Dow Jones Industrial Average were down by 197 points, or 0.7%, while S&P 500 futures slid 1.2%. Futures for the tech-heavy Nasdaq Composite were off by 2.8%.

Oil also tumbled with the price of West Texas Intermediate crude off by 5.3% and Brent crude down by 3.3%.

Asian markets rose on Tuesday while European stocks fell after a powerful rally, as traders waited for the restart of trading on Wall Street after a three-day break.

Catching up to Monday’s gains in Europe, the Nikkei 225 rose 0.8% and the Shanghai Composite added 0.7%.

The Stoxx Europe 600 slipped 0.3%, after a 1.7% advance on Monday.

A day after China reported its largest trade surplus with the U.S. in almost two years, President Donald Trump focused on the country in a news conference. “Whether it’s decoupling or putting in massive tariffs like I’ve been doing already, we’re going to end our reliance on China because we can’t rely on China,” said Trump.

The U.S. may ban cotton from the Xinjiang region of China over rights concerns, the New York Times reported. Semiconductor Manufacturing International Corp. slumped 22% in Hong Kong on Monday, after Reuters reported the Trump administration was weighing adding the microchip maker to its blacklist, which includes Chinese telecom equipment makers Huawei Technologies and ZTE.

Tech stocks are tumbling, and investors don’t need a reason to continue selling. Apple (ticker: AAPL) shares fell 4.6% premarket, continuing last week’s tech rout. Shares of Amazon (AMZN) were off by 3.8% and Microsoft (MSFT) shares fell 3.4%.

Tesla (TSLA) shares were off by 13.1% after the electric auto maker failed to be included in the S&P 500. and the company announced that it had completed its sale of $5 billion in stock.

But it wasn’t all bad news. Nikola (NKLA) shares soared 44.9% premarket after announcing it formed a partnership with General Motors (GM) and that GM now has an 11% stake in the electric truck maker. Shares of GM were up 6.2%.

Peloton Interactive (PTON) shares climbed 1.4% after it unveiled a new bike, a lower price treadmill, and a new fitness class format as people increasingly exercise at home due to gym closures amid the coronavirus pandemic. The company reports earnings results on Thursday.

Write to Steve Goldstein at sgoldstein@marketwatch.com and Carleton English at carleton.english@dowjones.com

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