(Reuters) – Wall Street’s three major U.S. indexes were set to open lower on Tuesday after rallying for four straight weeks, as fears of a global economic slowdown resurfaced after the International Monetary Fund trimmed its growth outlook in a week of heavy corporate earnings.

The gloomy IMF forecasts, released on Monday, predicted the global economy will grow at 3.5 percent in 2019 and 3.6 percent in 2020, down 0.2 and 0.1 percentage point, respectively, from last October’s forecasts.

The downgrades reflected weakness in Europe and were on the same day China released data that confirmed its slowest growth rate in 28 years due to faltering domestic demand and bruising U.S. tariffs.

A survey by auditing and accounting giant PwC offered investors little hope after it showed 29 percent of nearly 1,400 CEOs believed global economic growth will decline over the next 12 months, the highest percentage since 2012.

“The larger concern is slowing global economic growth,” said Art Hogan, chief market strategist at National Securities in New York.

“The S&P 500 has more than half of its companies with businesses overseas, so an outlook like this is also going to impact the earnings of 2019 as well,” said Hogan.

At 8:42 a.m. ET, Dow e-minis 1YMc1 were down 144 points, or 0.58 percent. S&P 500 e-minis ESc1 were down 17 points, or 0.64 percent and Nasdaq 100 e-minis NQc1 were down 49.75 points, or 0.73 percent.

The bigger-than-expected slowdown in China stoked concerns about fuel demand, which contributed to a near 1.5 percent fall in oil prices and weighed on energy stocks. [O/R]

With earnings season in top gear, analysts have lowered their fourth-quarter earnings forecast for S&P 500 companies to 14.2 percent year-over-year growth from 20.1 percent estimated on Oct. 1, according to IBES data from Refinitiv.

Johnson & Johnson (JNJ.N) shares dropped 1.5 percent after the healthcare giant forecast 2019 sales fell below analysts’ expectations.

Halliburton Co’s shares (HAL.N) fell 1.6 percent in premarket trading after the oilfield services company saw a slowdown in well completions in North America.

U.S.-listed Chinese stocks tumbled along with chip stocks, which get a large portion of their revenue from China. Advanced Micro Devices Inc (AMD.O) and Micron Technology Inc (MU.O) dropped 1.6 percent each.

Arconic Inc shares (ARNC.K) slumped 24.8 percent after the aluminum products maker said it was no longer pursuing a sale following media reports that private-equity firm Apollo Global Management LLC (APO.N) was near a deal to buy the company for more than $10 billion.

EBay Inc (EBAY.O) jumped 11.8 percent after shareholder Elliott Management Corp urged the ecommerce platform to restructure and sell some businesses to double its market value in the next two years.

U.S. stocks are coming off a strong rally in January fueled by hopes of a breakthrough in the U.S.-China trade talks and dovish comments from the Federal Reserve, setting the benchmark S&P 500 index about 8.9 percent away from its record closing high hit on September 20.

Source: Read Full Article