The first quarter wrapped on Tuesday with the Dow falling 200 points. 

And at around 9:00 p.m. ET on Tuesday night in New York, Dow Futures were taking a major leg lower. 

The only major news in markets on Tuesday night was manufacturing data out of China, which showed unexpected expansion in the country’s manufacturing sector, but indicated that growth still remains sluggish in the world’s second-largest economy. 

HSBC’s PMI reading, which came out after the official data, showed that manufacturing in China is in contractionary territory.

Commenting on the HSBC report, Annabel Fiddes, economist at Markit said:

The HSBC China Manufacturing PMI fell back below the neutral 50.0 mark at 49.6 in March, as the sector continues to struggle to gain growth traction. The latest data indicate that domestic and foreign demand remains subdued amid weaker market conditions, which dampened output growth as a result. Meanwhile, company downsizing policies contributed to a further decline in manufacturing employment, with the pace of job shedding the strongest since last summer.

At their lows, each of the major US indexes was down more than 1%, with Dow futures falling was much as 175 points, S&P 500 futures dropping as much as 21 points, and Nasdaq futures declining by as many as 52 points.

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Meanwhile, Nikkei futures, which can sometimes drive Dow Futures lower overnight as markets in Asia are open, were off as much as 1%.

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And the VIX, which measures volatility, spiked by as much as 6.8%.

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