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Wall Street is set to open higher on Tuesday following Monday's brutal market sell-off.

S&P 500 and Nasdaq futures were about 0.3% and 0.4% higher, respectively, at 6:30 a.m. ET.

Monday's falls were triggered by investors fearing the US economy could slip into a recession amid President Donald Trump's sweeping tariff and policy changes. On Sunday, Trump said the US is in the middle of a "transition" and did not rule out a recession.

In Asia Japan's Nikkei 225 closed 0.6% lower after falling as much as 2.7% to its lowest level since September 17. Meanwhile, the Japanese yen — a safe-haven currency — rose to a five-month high against the dollar.

South Korea's Kospi closed down 1.3% after falling by as much as 2.6%. Australia's ASX200 dropped 0.9%.

Hong Kong's Hang Seng Index ended flat after spending most of the day in the red, while China's CSI 300 bucked the trend to close 0.3% higher.

European markets were mixed on Tuesday, with London's FTSE 100 down 0.2% in late morning trading, while Germany's Dax 30 was up 0.2%. The Stoxx Europe 600 index fell 0.4%.

The action in Asia followed a selloff in the US with the S&P500 ending 2.7% lower. The tech-heavy Nasdaq 100 fell 3.8% and shed $1 trillion in value.

"Elevated uncertainty around the specifics/implementation of US tariffs is injecting volatility in financial markets, begging the question of whether the rotation away from US equities — which has gone hand in hand with a weaker dollar — is about to give way to a broader wave of risk-off price action," wrote GlobalData TS Lombard analysts in a Monday note.

The sell-off in US stock markets could prompt foreign investors to put their money elsewhere, changing up global financial flows, Nomura analysts wrote in a Monday note.

Read the original article on Business Insider