Stocks brace for selloff

NEW YORK (CNNMoney.com) -- U.S. stocks headed for a lower start Tuesday as a shake-up in world markets made its way across the Atlantic, adding to investor uneasiness about the economy.

Dow Jones industrial average, Nasdaq-100 and S&P-500 futures were lower, with most of the downturn occurring after 6 a.m. ET.

Futures measure current index values against their perceived future performance and offer an indication of how markets may open when trading begins.

Stocks ended mixed in a choppy session Monday as investors weighed a stronger dollar, falling oil and gold prices, and comments from Fed Chairman Ben Bernanke that cooled worries about higher interest rates.

David Jones, chief market strategist at IG Markets in London, said that Wall Street is following declining stock indexes in London, Paris and Frankfurt, which stem from a disappointing report on German industrial output.

"It's definitely driven by this German data," said Jones, noting that sluggishness in pre-Christmas trading has arrived early this year, which creating more volatility. "We're already seeing volume starting to drop off, so we're seeing more exaggerated moves."

Peter Cardillo, chief market economist for Avalon Partners, said U.S. futures also appears to be reacting to "continued pressure in the Dubai Market."

The Nasdaq's Dubai index has plunged since late November, when state-controlled Dubai World said it would have to postpone payments on its estimated $59 billion in debt. Dubai World has since stated that it would restructure half the debt, which stems from massive construction projects such as an artificial, palm-shaped residential island and a skyscraper intended to be the tallest in the world.

Economy. President Obama is due to speak on the economy at the Brookings Institution in Washington at 11:25 a.m. ET. He is expected to propose re-allocating $200 billion from the Troubled Asset Relief Program to fund new job creation efforts.

His comments will come on the heels of some encouraging signs in the two-year-old employment decline. In a survey released early Tuesday, employment services company Manpower Inc. said fewer companies plan to cut jobs in the first quarter of 2010. Last Friday, the November jobs report showed the smallest monthly decline in payrolls since the recession started in late 2007.

At 10 a.m. ET, the House Financial Services Committee will hold a hearing on private sector and government response to the mortgage foreclosure crisis.

A Labor Department report on job openings and labor turnover in October is expected at 8:30 a.m. ET.

Company news. Kroger (KR, Fortune 500) reported third-quarter financial results before the opening bell. The grocery chain reported a net loss of $1.35 per diluted share. But without including charges related to a wind-down of one of its divisions, net earnings would have been 27 cents per diluted share.

General Motors is scheduled to issue an update on its turnaround efforts in a press conference at 8:30 a.m. ET. New chief executive Ed Whitacre was originally scheduled to speak, a week after he and the GM board sought and received the resignation of CEO Fritz Henderson. But Whitacre was dropped from the update and will be replaced by two lower-level executives.

World Markets. Stocks in Asia ended lower, with Tokyo's Nikkei index slipping 0.3% and Hong Kong's Hang Seng index dropping 1.2%. European indexes were down about 1%, losing their earlier gains.

Other markets. The dollar rose against most major international currencies, but slipped against the yen.

Crude oil for January delivery fell $1.12 to $72.81 a barrel.

Gold futures for February delivery fell $1.65 to $1,163.40 an ounce after reaching a record settlement high of $1,218.30 last week.