March 22, 2018 / 12:01 PM / a month ago

US STOCKS-Futures back off on trade war fears, tech woes persist

* Futures down: Dow 188 pts, S&P 19.5 pts, Nasdaq 75.5 pts

By Sruthi Shankar

March 22 (Reuters) - U.S. stock index futures fell sharply on Thursday as technology stocks led the way lower on fears of increased regulations in the wake of Facebook’s data privacy issues, while the Trump administration’s move to impose import tariffs on China stoked fears of a global trade war.

Nasdaq futures were down more than 1 percent and a clutch of big tech names were all in the red in pre-market trading, led by a 1.5 percent slide in Facebook shares. Of the 25 most active stocks ahead of the bell, 22 were lower.

The downbeat sentiment also follows the Federal Reserve’s widely expected decision on Wednesday to raise U.S. interest rates by 25 basis points. The U.S. central bank forecast at least two more hikes for 2018, but nearly half of the policy makers projected three more this year and the pace of rate increases is seen quickening in the following two years.

In its first policy meeting under new Fed chief Jerome Powell, the central bank indicated that inflation should finally move higher after years below its 2 percent target and that the economy had recently gained momentum.

Stocks initially rose on the announcement, but ended slightly lower on Wednesday.

At 7:55 a.m. ET, Dow e-minis were down 188 points and S&P 500 e-minis fell 19.5 points. Nasdaq 100 e-minis dropped 75.5 points or 1.10 percent.

Having navigated past the Fed meeting, financial markets turned their attention to President Donald Trump’s plans to impose tariffs on Chinese imports, possibly targeting the country’s high-technology sector and restricting Chinese investments in the United States.

The White House said Trump would sign a presidential memorandum “targeting China’s economic aggression” at 12:30 p.m. ET on Thursday.

Tech stocks remained a weak spot after Facebook’s data breach issue raised fears that any failure by big tech firms to protect personal data could deter advertisers and users and invite tougher regulation.

Other than Facebook, social media stocks Snap and Twitter were down by more than 1 percent. The S&P 500 tech sector index has fallen 2.7 percent so far this week compared with a drop of less than 1.5 percent for the wider S&P 500. Facebook is down nearly 9 percent since Friday. (Reporting by Sruthi Shankar in Bengaluru Editing by Dan Burns)

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