Investing.com - U.S. stock markets looked set to extend the prior session’s losses on Tuesday, tracking global equity markets lower amid growing anxiety the U.K. will vote to leave the European Union later this month.
Recent polls suggested support for the U.K. campaign to leave the European Union is picking up. Britain's "Out" campaign widened its lead over the "In" camp ahead of the country's June 23 referendum, according to two opinion polls published by ICM on Monday.
The blue-chip Dow futures shed 26 points, or 0.15%, by 10:57GMT, or 6:57AM ET, the S&P 500 futures dipped 5 points, or 0.21%, while the tech-heavy Nasdaq 100 futures declined 11 points, or 0.25%.
Meanwhile, the Federal Reserve will begin its two-day meeting starting on Tuesday. While the U.S. central bank is not expected to take action on interest rates, it could provide guidance on its pace of tightening over the next several months.
Fed Chair Janet Yellen is to hold what will be a closely-watched press conference 30 minutes after the release of the Fed's statement, as investors look for any change in tone about the economy or future rate hikes. The central bank will also release its latest forecasts for economic growth and interest rates.
Investors all but ruled out a rate hike in June after U.S. employment data earlier this month showed the economy added just 38,000 jobs last month, the smallest increase since September 2010.
Market players are pricing in just a 2% chance for a rate hike this week and 23% for July, according to CME Group's (NASDAQ:CME) FedWatch tool. September odds were at about 37%.
U.S. economic reports Tuesday include May retail sales and import prices both at 12:30GMT, or 8:30AM ET. Business inventories are released at 10:00AM ET.
Lower oil prices further dampened sentiment. U.S. crude was down 63 cents, or 1.27%, at a two-week low of $48.26 a barrel during morning hours in New York, while Brent declined 64 cents, or 1.27%, to $49.69.
In Europe, equities fell to fresh three-month lows, with Germany’s DAX leading losses, as appetite for riskier assets faltered amid growing worries this month's referendum in Britain could see it exit the European Union.
Earlier, Asian stocks declined, with Japan’s Nikkei 225 falling 1%, hurt a strengthening yen.
In the currency market, the pound and the euro fell to their lowest level since 2013 against the safe-haven Japanese yen as growing anxiety over the prospect of the U.K. exiting the European Union left investors scrambling for safe haven assets.
Worries about a potential exit by the U.K. from the European Union left investors scrambling for safe haven assets, sending bond yields lower yet again.
German 10-year bonds fell to an all-time low of -0.034%. It last stood at -0.018%, down 4.6 basis points, or 167.8%, while U.K. 10-year bond yields fell 5.5 basis points, or 4.62%, to 1.155%, after hitting a session low of 1.146%, the lowest level on record.