By CCN.com: The Dow and broader U.S. stock market traded mixed-to-lower on Monday, as plunging technology shares and elevated trade-war risks weighed on investor morale. Market participants are becoming more convinced that the Federal Reserve will begin cutting interest rates as early as this summer to stave off recessionary headwinds.

Dow Recovers from Stock Futures Meltdown

The Dow Jones Industrial Average declined by as much as 114 points on Monday, reflecting a brutal pre-market for U.S. stock futures. The blue-chip index eventually pared losses, settling flat at 24,806.42. The index was supported by Verizon Communications Inc. (VZ), which finally stemmed a brutal five-day losing skid with gains of 3.9%.

The broad S&P 500 Index of large-cap stocks declined 0.3% to 2,744.45, with losses concentrated in three of 11 primary sectors. Communication services plunged nearly 3%. Shares of information technology and consumer discretionary shares declined by at least 1.3%. Most other sectors reported gains.

Plunging technology shares dragged the Nasdaq Composite Index to its lowest level since February. The technology-focused average plummeted 1.6% to settle at 7,333.02.

Rate Cut Gauge Leaps to 60% as Recession Alarms Ding

Stocks and bond yields fell in lockstep with one another on Monday, as investors continued to hedge against a global economic slowdown stoked by a U.S.-China trade war.

For the first time this year, Wall Street traders expect the Federal Reserve to slash interest rates in July to avoid a deeper market correction and ensure that recessionary headwinds are kept at bay. According to CME Group’s FedWatch Tool, the likelihood of a July rate cut stands at just over 60%.

Central bankers have adopted a more or less neutral approach to monetary policy, but heightened trade tensions between the U.S. and its biggest export markets threaten to undermine the domestic recovery. The Trump administration has opened multiple fronts in its global trade war, having recently slapped Mexican imports with a 5% duty.

Washington has also removed India from a special trade program because the South Asian country hasn’t “assured the United States that [it] will provide equitable and reasonable access to its markets.”

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