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Stocks slide as US weighs curbs on more Chinese tech firms

➤ Reports suggest U.S. considering targeting more Chinese tech firms

➤ Tories expected to urge UK PM to drop 4th Brexit vote, citing little support

➤ FOMC meeting minutes due later today

U.S. stocks declined May 22, alongside most European equity markets, as Washington was said to be considering blacklisting more Chinese tech firms. The pound slipped as pressure mounted on Prime Minister Theresa May to quit after her new Brexit proposals failed to impress the opposition.

The U.S. is reportedly weighing whether to blacklist up to five Chinese surveillance firms, following a decision to temporarily lift restrictions on Huawei Technologies Co. Ltd.

"This would further inflame tensions and make a near-term trade deal even more unlikely," Brown Brothers Harriman wrote.

S&P 500 was down more than 0.3% and Nasdaq 100 slipped 0.2% around 10 a.m. ET.

The U.K.'s FTSE 100 was little changed while Germany's DAX and French CAC 40 fell 0.3% and 0.4%, respectively. In Asia, the Shanghai SE Composite dropped 0.5%, while Hong Kong's Hang Seng index ticked up nearly 0.2%.

Hangzhou Hikvision Digital Technology Co. Ltd., one of the companies on the list being looked at by U.S. officials, closed the session 5.5% down.

Japan's Nikkei 225 index was little changed, as the Japanese trade surplus for April missed expectations as exports weakened.

The Trump administration is reportedly set to offer U.S. farmers aid that could top $15 billion as agriculture remains in the crosshairs of the intensifying trade war with China.

U.S. bonds gained as yields on 10-year Treasurys declined 3 basis point to 2.400% as of 10:07 a.m. ET, ahead of the U.S. Federal Open Market Committee's minutes from its last meeting.

"A positive bias among the U.S. policymakers would be well received by stock investors while a cautious tone — pointing towards rate cuts — could also be considered a boon," wrote Konstantinos Anthis, head of research at ADSS. Any clues that policymakers have begun considering a rate cut will weigh down on the U.S. dollar, while bullish consensus will lift the dollar.

In currencies, sterling came under pressure as May offered Parliament a vote on whether to hold a second Brexit referendum and raised the possibility of closer trading arrangements with the EU as part of concessions she hopes will improve the prospects of getting her deal passed. However, the opposition Labour Party seemed unconvinced, with Jeremy Corbyn saying that the offer reflects "the same old bad deal."

With May's Brexit deal destined to fail for a fourth time, Conservative Party officials are expected to urge May to cancel the parliamentary vote, scheduled for early in June, Bloomberg News reported.

Sterling lost 0.6% against the dollar around 10 a.m. ET.

"There now appears a growing risk that a fall away in Conservative support on a fresh vote would not be compensated by increased Labour Party support," wrote MUFG Bank analysts in a note, adding that a fourth meaningful vote will be defeated by a greater margin than the margin of defeat in March.

The euro was little changed against the dollar, while the Japanese yen gained.

Brent crude oil fell 0.5% to $71.83 per barrel on the ICE Futures Exchange, while gold was little changed.

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The day ahead:

10 a.m. ET — U.S. Fed's John Williams speaks

10:10 a.m. ET — U.S. Fed's Raphael Bostic speaks

10:15 a.m. ET — U.S. Fed's Robert Kaplan speaks

10:30 a.m. ET — Energy Information Administration petroleum status report

2:00 p.m. ET — U.S. Federal Open Market Committee minutes

4 p.m. ET — Bostic speaks

8:30 p.m. ET — Japan purchasing managers' manufacturing index