NEW YORK: US index futures lurched lower on Thursday, signaling no respite to the rout that’s lopped more than US$3 trillion from the market since late September.

S&P 500 Index contracts slumped as much as 1.9 percent from Tuesday’s close, before trading at 2,666, down 1.3 percent, as of 12:24 p.m. in Singapore. 

Selling pressure early in the session was so intense that it forced CME Group to intermittently pause trading, according to a spokesperson for the exchange.

Concern about China-U.S. trade relations deepened after the arrest of Huawei Technologies Co.’s Chief Financial Officer Wanzhou Meng, though traders were still puzzled at the magnitude of the declines. Some speculated that Wednesday’s closure for cash markets and shortened session in futures was a factor.

“Futures were up overnight but when I looked tonight -- I said 'Oh my god’,” said Donald Selkin, chief market strategist at Newbridge Securities, in a phone interview. 

“I was surprised in light of the fact that last night and during the day today they were up. Why all of a sudden was the optimism fleeting?"

The plunge was the last thing that investors needed, already skittish after Tuesday’s rout and an enforced lull on Wednesday for a day of mourning for former President George H.W. Bush. 

The S&P 500 plunged 3.2 percent on Tuesday, its biggest slide since the mid-October sell-off, while the Dow Jones Industrial Average sank almost 800 points as a litany of concerns wiped out the rally in risk assets.

Some of the bricks in the wall of worry:

A segment of the U.S. yield curve inverted for the first time in more than a decade, a phenomenon that has occurred before previous recessionsConcern about what has actually been agreed between U.S. President Donald Trump and China President Xi Jinping on trade

And the economic outlook: the Federal Reserve’s Beige Book report published Wednesday showed fading optimism over growth prospects at U.S. firms.

“One thing adds to the other - there’s concern about the flattening yield curve, the direction of the policy, ” said Walter “Bucky” Hellwig, senior vice president at BB&T Wealth Management. 

“Coupled with that is concern about slowing growth. It seems like the growth concern isn’t removed, and it’s building rather than receding.”

Thursday’s moves look even worse if the rebound in Wednesday’s abbreviated futures trading session is taken into account. 

S&P 500 futures fell as much as 2.5 percent from levels on Wednesday, a non-settlement day.

“It does seem to be a very nervous market at the moment,” said Nick Twidale, chief operating office at Rakuten Securities’ Australian unit.

CME Group said that volatility near the open triggered more than 40 of what it calls “velocity logic events,” causing intermittent trading pauses in equity index futures and options. 

All markets operated as designed throughout, according to the spokesperson.

No Bottom

For Bruce McCain, chief investment strategist at KeyBank, the big concern is whether there will be a floor to the market sell-off. 

“The fear is that there may not be a bottom to this weakness - because the U.S. economy is weaker than we see right now and because global growth is decelerating faster than we expected,” he said.

A sharp decline in long-term Treasury rate and the lingering trade concerns are likely “lingering at the back of traders’ minds” as the rout continues. “There are too many issues to be concerned about,” McCain added. - bLOOMBERG