By Barbara Kollmeyer, MarketWatch

Fed, China worries continue to roil markets

Stock futures pointed to opening losses for Wall Street on Monday, as a rocky month closes out with fresh worries over China and no clear view on whether the U.S. Federal Reserve will hike U.S. interest rates in September.

Futures for the Dow Jones Industrial Average slid 161 points, or 1%, to 16,498, while those for the S&P 500 index dropped 18.95 points, or 1%, to 1,970.50. Futures for the Nasdaq-100 index fell 33.50 points, or 0.8%, to 4,299.25.

The Shanghai Composite dropped 12.5% for August as it lost more ground on Monday (http://www.marketwatch.com/story/asian-stocks-poised-for-worst-month-in-more-than-three-years-2015-08-31). Stocks were hit by a report in the Financial Times that the Chinese government will no longer make large stock purchases to prop up the markets (http://www.marketwatch.com/story/china-wont-be-propping-up-its-stock-market-with-big-stock-buys-report-2015-08-31).

"It seems like we simply need a reason to panic these days," Chris Weston, chief market strategist at IG, said in a note.

Investors had to know that the government wasn't going to keep pouring money into stock markets, he wrote. "Still, the fact that the mainland markets are down seems driven by the idea that officials have moved a more reactive function and there is a general concern of policy missteps."

Meanwhile, the weekend economic symposium in Jackson Hole, Wyo., sponsored by the Federal Reserve Bank of Kansas City, only "increased the level of uncertainty" over the next move in U.S. interest rates, said Nour Al-Hammoury, chief market strategist at AG, in a note. "The markets are waking up to the realty that there is no clear direction being set by the bankers or the Fed."

While an increasing number of investors believe recent market turmoil could help delay a near-term U.S. rate hike, Vice Chairman Stanley Fischer over the weekend seemed to open the door for a move (http://www.marketwatch.com/story/fed-watching-china-closely-fischer-says-2015-08-29), suggesting that markets might calm down quickly.

Read: Jackson Hole roundup: No clear path for Fed in September (http://www.marketwatch.com/story/jackson-hole-roundup-no-clear-path-for-fed-in-september-2015-08-29)

Analysts said investors would be looking to Friday's nonfarm payroll jobs data for the next clues (http://www.marketwatch.com/story/jobs-report-could-prevent-rate-hike-but-unlikely-to-ensure-one-2015-08-30) about what will happen at September's Fed meeting. A disappointing number could lend credence to those who believe the Fed should not rush into raising rates. Economists polled by MarketWatch are forecasting a gain of 223,000 for August after 215,000 jobs were added in July.

Read: Jobs report could prevent rate increase -- but unlikely to ensure one (http://www.marketwatch.com/story/jobs-report-could-prevent-rate-hike-but-unlikely-to-ensure-one-2015-08-30)

(http://www.marketwatch.com/story/jobs-report-could-prevent-rate-hike-but-unlikely-to-ensure-one-2015-08-30)The only data scheduled for Monday is the Chicago Purchasing Managers' index, due for release at 9:45 a.m. Eastern Time.

A rough August for stocks: Stocks logged modestly weekly gains on Friday after closing mixed on the day. Fresh in investor's minds is the fact that a week ago on Monday, the Dow industrials lost 1,000 points in a matter of minutes as concerns over China tormented the market.

With one day of trading still to go, the Dow industrials and S&P 500 index are each poised to log the biggest one-month point losses since October 2008 and the biggest one-day percentage falls May 2012. Through Friday, the DJIA has lost 1,046.85 points, or 5.92%, while the S&P 500 has lost 114.97 points, or 5.46%.

Nonetheless, Goldman Sachs is sticking to its year-end 2015 S&P target of 2,100, which reflects upside of 6% from here, David Kostin, its chief U.S. equity strategist, said in a note on Monday. "Continued positive macro data will be essential if our forecast is to be realized," he said.

Kostin said a risk to that forecast would be negative earnings preannouncements during the last two weeks of September, ahead of the third-quarter reporting season.

Stocks to watch: Staples Inc. (SPLS) and Office Depot (ODP) said late Friday they will delay the closing of their merger (http://www.marketwatch.com/story/staples-office-depot-to-delay-close-of-merger-on-ftc-request-2015-08-28) in order to provide the Federal Trade Commission with more information on the deal.

Executives at Apple Inc. (AAPL) are considering a price for the next generation of Apple TV that would be more than double (http://www.marketwatch.com/story/apple-will-double-the-cost-of-next-apple-tv-2015-08-30) the cost of the current $69 being charged currently, according to 9to5Mac.com, citing sources.

Other markets: Japan's Nikkei 225 index dropped 1.3%, and lost 8.2% for the month of August (http://www.marketwatch.com/story/asian-stocks-poised-for-worst-month-in-more-than-three-years-2015-08-31). The Europe Stoxx 600 index dropped 0.8%, with the German DAX 30 index down over 1% as major oil companies across Europe dropped. U.K. markets are closed for a holiday.

Crude for October delivery fell $1, or 2.2%, to $44.22 a barrel, while Brent crude for the same month slid $1.32, or 2.7%, to $48.73 a barrel. The dollar was marginally weaker across major currencies, while gold prices were also marginally off.

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(END) Dow Jones Newswires

August 31, 2015 06:04 ET (10:04 GMT)

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