(Reuters) – U.S. stock index futures resumed their slide on Tuesday as gloomy quarterly earnings reports and a historic collapse in U.S. crude prices to below zero raised the spectre of a deep global recession in the coming months.

The Wall Street sign is pictured at the New York Stock exchange (NYSE) in the Manhattan borough of New York City, New York, U.S., March 9, 2020. REUTERS/Carlo Allegri

Wall Street fell on Monday as plunging oil demand pushed WTI crude CLc1 to minus $40 for the first time. With nowhere to store the excess capacity, traders fled from contracts that would deliver barrels of oil to them in May.

Exxon Mobil Corp (XOM.N) shed 3.9% in premarket trading and Chevron Corp (CVX.N) slipped 3.6% as the front month May WTI CLc1 contracts continued to trade below $0 on Tuesday. June contracts also fell by $4, signalling more weakness in demand in the face of a near halt in global activity. [O/R]

“Yesterday, the historic oil crash had a limited impact on U.S. stocks, but that won’t be the case going forward as the rolling of contracts won’t wait so close to expiry,” said Edward Moya, market analyst at OANDA.

“Oil prices will remain heavy in the short-term and since many energy stocks have recently rebounded, they are ripe to see a lot of pain this week.”

Other oil-related companies including Apache Corp (APA.N), Halliburton Co (HAL.N), ConocoPhillips (COP.N), Schlumberger (SLB.N) and Occidental Petroleum Corp (OXY.N) tumbled between 4.5% and 6%.

The benchmark S&P 500 index .SPX has climbed over 25% from a March low, powered by trillions of dollars in stimulus, but still remains nearly 17% below its record high amid fears of the biggest economic slump since the Great Depression.

At 7:33 a.m. ET, Dow e-minis 1YMcv1 were down 430 points, or 1.83%, S&P 500 e-minis EScv1 were down 39.5 points, or 1.41% and Nasdaq 100 e-minis NQcv1 were down 74.75 points, or 0.86%.

Dismal 2020 forecasts from big U.S. banks kicked off the first-quarter U.S. corporate earnings season and major companies have since announced dividend cuts and withdrawn financial outlooks.

Analysts expect a corporate recession this year with earnings for S&P 500 firms falling 13.5% in the first quarter and 29.1% in the second, according to IBES data from Refinitiv.

Coca-Cola Co (KO.N) provided the latest evidence of the damage wrought by the pandemic, saying its current-quarter results would take a severe hit from low demand for sodas.

Travelers Companies (TRV.N) fell 1.7%, after the insurer reported a 25% fall in quarterly profit, hurt by higher catastrophe losses.

Among other Dow components, International Business Machines Corp (IBM.N) slid 4.9% after the company withdrew its 2020 annual forecast late on Monday.

Lockheed Martin Corp (LMT.N), the Pentagon’s No.1 weapons supplier, rose 1.4% after reporting a 9.2% rise in quarterly revenue, helped by higher sales in its aeronautics unit that makes the F-35 fighter jets..

Chip industry bellwether Texas Instruments (TXN.O) is set to report its first-quarter earnings later in the day.

Reporting by C Nivedita and Shreyashi Sanyal in Bengaluru; Editing by Saumyadeb Chakrabarty, Sagarika Jaisinghani and Arun Koyyur

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