U.S. futures lower amid budget concerns; Dow Jones down 0.32%

Investing.com - U.S. stock futures pointed to a lower open on Monday, as market sentiment weakened after U.S. lawmakers failed on Friday to avert a first series of automatic spending cuts.

Ahead of the open, the Dow Jones Industrial Average futures pointed to a 0.32% fall, S&P 500 futures signaled a 0.39% drop, while the Nasdaq 100 futures indicated a 0.42% loss.

Investor confidence weakened after USD85 billion of automatic spending cuts, known as the "sequestration", began on Friday as lawmakers could not agree on spending cuts and tax reform to tackle the country's budget deficit.

U.S President Barack Obama said on Sunday he could compromise with Republican lawmakers by cutting welfare entitlements such as Medicare.

Tech stocks were expected to be active, after Sony said it aims to win third place in smartphone markets around the world behind Apple and Samsung Electronics, pitting it against Chinese companies Huawei Technology and ZTE which are looking to become the third big player in mobile devices.

Shares in Apple slipped 0.11% in pre-market trade.

Separately, the Wall Street Journal reported that Pratt & Whitney, a subsidiary of United Technologies, uncovered a fraudulent scheme of testing engine parts by another unit of United Tech.

Financial stocks were also likely to be in focus, Goldman Sachs and Citigroup stepped up warnings to shareholders about cyber attacks as the U.S. prodded banks and government agencies to bolster their defenses.

Among energy-linked stocks, as ConocoPhillips, which has been looking to sell down its interest in Canada's oil sands, said that moves by Ottawa to limit foreign investment in that country's resources have made it more difficult for some buyers.

Across the Atlantic, European stock markets were sharply lower. The EURO STOXX 50 dropped 0.45%, France’s CAC 40 fell 0.23%, Germany's DAX retreated 0.56%, while Britain's FTSE 100 slid 0.49%.

During the Asian trading session, Hong Kong's Hang Seng Index tumbled 1.50%, while Japan’s Nikkei 225 Index advanced 0.4%.

Markets were also jittery after China announced more property market tightening measures on Friday, in a bid to contain housing costs.