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Dow Futures Wobble, Dollar Surges to 20-Year High—and What Else Is Happening in the Stock Market Today

Investors remain focused on the Federal Reserve’s monetary policy pathway.

Anna Moneymaker/Getty Images

U.S. stocks were wobbling after two days of losses—following three straight weeks of declines—as investor sentiment remained under pressure from multiple macro factors. The U.S. dollar pushed to a new 20-year high against its peers.

Futures for the Dow Jones Industrial Average gained 10 points, or less 0.1%, after the index tumbled 173 points to close at 31,145 on Tuesday. S&P 500 futures were up 0.1%, with the tech stock-heavy Nasdaq poised to rise 0.3%. Futures were in the red earlier in the premarket.

Overseas, the pan-European Stoxx 600 fell 0.5% as worries around a regional energy crisis remained salient in the wake of Russia’s halt to natural-gas flows in the Nord Stream 1 pipeline. Hong Kong’s Hang Seng Index retreated 0.9% in the wake of weak trade data out of China.

The major indexes were wobbling by midweek after stocks fell on Tuesday, remaining vulnerable to what would be the fourth straight week of losses if a turnaround fails by Friday. September has a reputation as the worst month of the year for stocks, and so far post-Labor Day trading has been far from upbeat.

“With different asset classes swinging between gains and losses over the last 24 hours, it’s been difficult to point to a single factor behind the various moves,” said Jim Reid, a strategist at Deutsche Bank. “Investors remain cautious about the growing array of risks on the horizon, ranging from the European energy situation to Chinese lockdowns to hawkish central banks.”

Adding pressure to investor sentiment Wednesday was poor trade data out of China, raising worries about weakening global demand and a slowdown in the world’s second-largest economy. Exports grew 7.1% year over year in August, below the 13% expected and the 18% notched in July. Imports rose just 0.3%, below expectations of 1.1%. 

“This morning’s latest trade numbers for August merely serve to underscore how weak domestic demand still is, and how far away that end of year GDP target of 5.5% is,” said Michael Hewson, an analyst at broker CMC Markets. “It’s further away than ever after today’s data and we could be lucky to see half that number at this rate … It’s hard to see a scenario for a significant economic pickup much before next year.”

In the currency space, the dollar touched a fresh 20-year high, with the U.S. Dollar Index—which measures the greenback against a basket of six peers—hitting 110.69.

“King dollar’s scorched-earth ascent to a fresh 20-year peak has clobbered broad swathes of global financial markets,” said Han Tan, an analyst at broker Exinity. “The greenback has clearly fed off the palpable anguish surrounding a Fed that’s now persistently ultra-aggressive in its battle against multi-decade high inflation. The risk aversion that’s coursing through markets also suggests that global stocks could move much further to the downside over the immediate term.”

Write to Jack Denton at jack.denton@dowjones.com