Stock futures tanked on the first trading session of the year after global markets slumped on weak Chinese manufacturing data and geopolitical tensions between Saudi Arabia and Iran.
S&P 500 futures fell 1.8% on Monday, Dow Jones Industrial Average futures slid 1.7%, and Nasdaq futures tumbled 2%.
China's Shanghai Composite plummeted 7% before triggering a trading halt after manufacturing activity contracted for the 10th straight month. The official manufacturing PMI came in at 49.7, while Caixin manufacturing PMI fell to 48.2. A reading below 50 indicates contraction. China's economic growth came under scrutiny in 2015 as data indicated a steeper slowdown than feared.
Global markets were also lower after Saudi Arabia severed diplomatic relations with Iran on Sunday. Protesters torched a Saudi Arabian Embassy in Tehran on Saturday in response to Saudi Arabia's execution of 47 prisoners, including Shiite cleric Nimr Baqr al-Nimr.
Tensions pushed the price of crude oil higher on potential supply disruptions between the two. West Texas Intermediate crude oil added 0.5% to $37.23 a barrel. Crude recently closed out the year down more than 30%.
Shire (SHPG) is in advanced talks to acquire Baxalta (BXLT) for around $32 billion in cash and stock, or around $46.50 to $48 a share, sources told Bloomberg. A deal could be announced as soon as this week after final details are negotiated. A combined company would generate $20 billion in sales by 2020.
Nokia (NOK - Get Report) climbed more than 2% in premarket trading after officially gaining control of Alcatel-Lucent (ALU) through an all-share deal. Nokia will hold 79% of Alcatel shares and expects to become a fully-functional combined group by the middle of the month.
American Express (AXP - Get Report) and Bank of America (BAC - Get Report) were under pressure after Fidelity Investments dropped the two as credit card partners after 12 years. Visa (V - Get Report) and U.S. Bancorp (USB - Get Report) will take over as the network and issuer of the Fidelity card.
Tesla (TSLA - Get Report) shares tumbled more than 4% in premarket trading on Monday after the automaker said it delivered 17,400 cars in the fourth quarter, up from 11,603 in the previous quarter. The company said it delivered 50,580 Model S sedans and Model X sport utility vehicles in 2015, falling at the low end of previous guidance.
Disney's (DIS - Get Report) Star Wars: The Force Awakens is set to become the highest-grossing film of all time in North American theaters this week. Avatar had previously held the title. The domestic gross for the film currently stands at $740.3 million, while globally it has generated $1.5 billion.