US Stock Futures Edge Lower Ahead of Trump Tariff Policy Shift, Inflation Testimony
US stock futures declined on Tuesday as investors anticipated further tariff policy shifts from President Donald Trump. Focus also shifted to inflation, with Federal Reserve Chair Jerome Powell set to testify before Congress.
* Dow Jones Industrial Average futures (YM=F) retreated 0.2%.
* S&P 500 futures (ES=F) dropped 0.3%.
* Contracts on the tech-heavy Nasdaq 100 (NQ=F) pulled back 0.4%.
Markets remained cautious as investors awaited Trump's announcement of planned universal tariffs. The president imposed 25% tariffs on steel and aluminum imports from March 4, intensifying pressure on key trading partners Canada and Mexico.
Investors are assessing the potential impact of Trump's tariff threats on corporate earnings, the global economy, and inflation. Amid uncertainty, gold (GC=F) briefly reached a record high as investors sought safe-haven assets, before retreating on Tuesday.
Powell's two-day testimony before Congress will be closely watched for any indications of how the Fed views the potential effects of tariffs on price pressures.
The Consumer Price Index and wholesale counterpart readings for January will be released on Wednesday and Thursday, respectively, providing insights into inflation trends. Markets will seek clues on whether conditions warrant interest rate cuts, despite potential tariff headwinds.
In technology, Elon Musk's bid to acquire OpenAI drew attention, amidst concerns about AI spending. Meta (META) initiated layoffs as CEO Mark Zuckerberg aims to pivot towards AI talent acquisition.
Coca-Cola's earnings report is expected to show growth as the company competes with PepsiCo. Wall Street anticipates revenue of $10.67 billion and earnings per share of $0.52 for the fourth quarter. Super Micro Computer (SMCI), Lyft (LYFT), and DoorDash (DASH) also have earnings reports scheduled.
Gold Benefits from Stock Market Uncertainty
Gold (GC=F) continued to gain traction amid stock market uncertainty. President Trump's tariffs pushed the safe-haven asset to a second consecutive all-time high this week, with bullion reaching over $2,921 an ounce.