U.S. stock index futures pointed to a slightly lower opening on Tuesday morning after a turbulent day of trading on Monday. Signs that China would let the yuan float and thus boost American exports and Chinese consumption were replaced with concerns about financial retrenchment and risk aversion.
Dow Jones futures were down 5 points and the S&P 500 was down 1.30, while tech stocks on the Nasdaq pushed it a little higher by 2.50. The positive effect of the yuan news seemed to have completely worn off, and the Chinese currency actually ended yesterday slightly lower.
According to Bloomberg News and other sources, the main reason for the retreat was a sense that the Chinese central bank would not allow meaningful gains in the currency.
South of the border, however, the Mexican Bolsa and Brazilian BOVESPA futures both posted small gains, possibly buoyed by the relatively positive performance of Brazilian heavy industry stalwarts like Petrobras and Vale yesterday.
Ambiguous information and signals look to be the defining characteristic of the day, as markets struggle to digest what, if any, meaningful changes will occur in Chinese currency policy and worldwide government spending.
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