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Stock futures were slightly higher Tuesday, as investors continue to monitor the Russia-Ukraine war and look ahead to the Federal Reserve's widely expected interest rate hike Wednesday. A drop in oil prices lent support to stock futures.
The broad S&P 500 and tech-focused Nasdaq both fell in Monday's session, marking their seventh negative day out of the past eight. With its 2% decline Monday, the Nasdaq is firmly in a bear market, off about 22% from its November record. The Dow, which finished essentially flat Monday, and S&P 500 remain in correction territory.
Oil traded lower Tuesday, extending its recent downward trend after the Russia-Ukraine war sparked shortage concerns and caused prices to skyrocket. West Texas Intermediate crude futures, the U.S. oil benchmark, fell about 6% to trade below $97 per barrel, its lowest level since March 1. Just over a week ago, WTI briefly hit $130. International benchmark Brent crude traded around $100.67 per barrel Tuesday, down nearly 6% on the session. On March 7, Brent touched $139.13 per barrel, its highest price since July 2008. The cool down in oil comes as Ukraine and Russia, a major energy producer, hold peace talks, and China's worsening Covid outbreak may weaken demand from the world's second largest economy.
The Ukrainian capital of Kyiv is set to begin a 35-hour curfew, the city's mayor, Vitali Klitschko, announced Tuesday. The decision to prevent residents from moving about unless they have a special pass or are going to a bomb shelter was made by the Ukrainian military command, Klitschko said, because Kyiv is in "a difficult and dangerous moment." Multiple residential buildings in Kyiv were damaged by Russian ammunition earlier Tuesday.
Also Tuesday, Russian and Ukrainian officials are scheduled to resume cease-fire negotiations after they were paused Monday. China's foreign minister, Wang Yi, also indicated Beijing wants to avoid being impacted by the economic sanctions the U.S. has imposed on its ally Russia. The U.S. and China held "intense" diplomatic talks a day earlier. Washington has warned China that it could face penalties if it helped Russia work around any U.S. sanctions.
Chinese stocks sold off again Tuesday, as investors weighed a number of concerns, including potential delistings from U.S. exchanges and a worsening coronavirus outbreak in major cities. Hong Kong's Hang Seng index tumbled 5.72% to finish at 18,415.08, its lowest close since Feb. 12, 2016. The index is down 19% so far in March, which Reuters reported is its worst monthly performance since 2008.
In mainland China, the Shenzhen component tumbled 4.36% to close at 11,537.24, while the Shanghai composite fell nearly 5% to end the day at 3,063.97. The indexes fell 3% and 2.6%, respectively, on Monday.
After new health restrictions hit Shanghai and technology hub Shenzhen in recent days, on Tuesday Dongguan city announced tougher measures to limit new cases including production halts in industrial parks where Covid infections have been reported. China is grappling with its worst virus outbreak since the early days of the pandemic in 2020.
Just days after CEO Elon Musk warned about inflationary pressures facing its business, Tesla hiked the prices of its electric vehicles in China and U.S. Those are two key markets for the world's most valuable automaker. It's the second time in a week that Tesla has raised prices for some vehicles.
In other Tesla news, CNBC reported Monday on internal documents that showed the electric-auto maker has bought aluminum from Russian company Rusal since late 2020. The revelation sheds light on the complex nature of supplier relationships during a war. Rusal's founder is sanctioned Russian oligarch Oleg Deripaska.
— CNBC's Chloe Taylor, Eustance Huang and Lora Kolodny contributed to this report.