Asian markets looked set to decline on Wednesday, with a sell-off in U.S. and European markets expected to weigh on sentiment during the Asian trading session.

Futures tipped a lower open on Wednesday for both Japan and Australia. Nikkei futures traded in Chicago were down 1.49 percent compared to the benchmark’s Monday close and Australian SPI futures were 0.75 percent lower at the end of the previous session.

U.S. stocks sold off on Tuesday amid a political crisis in Italy and as investors digested trade negotiations between the U.S. and China.

The Dow Jones industrial average slid 1.58 percent, or 391.64 points, to 24,361.45, the S&P 500 lost 1.16 percent to close at 2,689.86 and the Nasdaq composite declined 0.5 percent to end at 7,396.59.

The losses seen on Tuesday marked the worst daily performance for both the Dow and S&P 500 since April 24. Both stock indexes were also down for the third consecutive session.

That followed weakness in European markets in the last session, with the pan-European Stoxx 600 ending down 1.37 percent. In Italy, the FTSE MIB tumbled 2.65 percent amid ongoing political turmoil which is expected to lead to a fresh vote in the months ahead.

Italy has been without a government since an inconclusive vote in early March, with anti-establishment political groups abandoning efforts to form a coalition over the weekend amid a dispute with the country’s head of state.

The euro traded at $1.1543 at 6:50 a.m. HK/SIN, which was below the $1.16 level seen in the previous session. The dollar index, which tracks the dollar against several major currencies, stood at 94.833.

The 10-year Italian bond yield cracked above the 3.38 percent level early in the last session as investors sold Italian bonds, while the 10-year U.S. Treasury yield fell, slipping below the 2.8 percent level.

After what seemed like a cooling in tensions between the U.S. and China over bilateral trade issues, the White House on Tuesday said it was moving ahead with plans to subject around $50 billion in Chinese imports to tariffs.

On the commodities front, U.S. West Texas Intermediate crude futures settled 1.7 percent, or $1.15, lower at $66.73 per barrel after news last week that OPEC producers had discussed raising output. Brent crude futures added 9 cents to settle at $75.39.

Here’s the economic calendar for Wednesday (all times in HK/SIN):

• 7:50 a.m.: Japan retail sales
• 9:30 a.m.: Australia building approvals
• 1:00 p.m.: Japan consumer confidence

Also of note, Indonesia’s central bank will meet on Wednesday after seeing little success with recent attempts to prop up the Indonesian rupiah. Most analysts polled by Reuters expect Bank Indonesia to raise its main rate by 25 basis points.

Bank of Japan Governor Haruhiko Kuroda, meanwhile, is expected to speak at a conference at 8:00 a.m. HK/SIN.

— CNBC’s Sam Meredith contributed to this report.