Investors can expect the ASX to drop in early trade after reports the Trump administration was weighing a range of sanctions on Chinese officials, businesses and financial institutions.
The SPI 200 futures contract was lower by 63 points, or 1.08 per cent, to 5,744.0 at 0700 AEST on Wednesday, indicating losses in early trade.
Overnight US stocks pared gains late in the session, after Bloomberg News reported US President Donald Trump was considering sanctions, reinforcing comments earlier from White House adviser Larry Kudlow.
Kudlow said the president was “so miffed with China on virus and other matters that the trade deal is not as important to him as it once was”.
The benchmark S&P 500 had crossed 3000 for the first time since March 5 before dropping back late in Tuesday’s session.
It closed 11.7 per cent below its February 19 record high.
Meanwhile in Australia today, construction data for the March quarter is due.
The Australian share market enjoyed its best day in seven weeks on Tuesday.
The S&P/ASX200 benchmark index closed up 164.4 points, or 2.93 per cent, at 5,780 points, while the All Ordinaries index was up 160 points, or 2.79 per cent higher, at 5,889.9.
The Australian dollar was buying 66.54 US cents at 0700 AEST, higher from 65.91 US cents at the close of trade on Tuesday.