(Reuters) -U.S. stock index futures rose on Tuesday, bouncing back after equities tumbled in the previous session, when President Donald Trump’s criticism of Federal Reserve Chair Jerome Powell rattled investors.
All three major indexes ended Monday’s session down more than 2% after Trump redoubled his attacks against Powell for not cutting interest rates, sparking concern about the central bank’s independence and the future monetary policy path.
While equity futures found some footing in early trading on Tuesday, the mood remained fragile as investors awaited Trump’s next steps vis-à-vis Powell. Clarity on U.S. tariff policy and the outcome of negotiations with individual countries on reciprocal levies are also in focus.
Trump’s legal ability to fire the Fed chair remains unclear.
Investors will focus on a bevy of corporate results, which are due throughout the week, for indications on how companies are navigating the uncertainty caused by tariffs and their expectations for a hit on future earnings.
Halliburton, Verizon Communications and 3M Company are among companies reporting before the bell.
Shares of Tesla, which will kick off earnings for the “Magnificent Seven” group of megacap stocks after markets close, rose 0.9% in premarket trading.
At 5:35 a.m. ET, Dow E-minis were up 340 points, or 0.89%, S&P 500 E-minis were up 52 points, or 1%, and Nasdaq 100 E-minis were up 182.5 points, or 1.02%.
Megacap tech stocks, among the hardest hit by Monday’s selloff, rose. Nvidia added 1.5%, Amazon.com was up 1.3% and Apple gained 1.2%.
Over the last week, safe-haven assets, most notably gold, have surged. However the dollar and U.S. equities have slid while Treasury yields – which move inversely to prices – have risen.
Those moves are “causing existential angst among investors, which is inevitably weighing on equities and risk sentiment, with U.S. stocks in the firing line”, said Kathleen Brooks, research director at XTB.
“The market is pricing in a political risk premium for U.S. assets,” Brooks said.
Indexes have fallen sharply this year as Trump’s erratic trade policies rattled markets, with the S&P 500 16% below its February 19 record closing high.
A close 20% below that mark would confirm that the index has entered a bear market. The Nasdaq Composite confirmed it was in a bear market earlier this month.
Commentary from five Fed speakers is expected through the day, including Vice Chair Philip Jefferson. Their comments are likely to be closely watched for clues on the central bank’s policy outlook and views on rising tensions with the White House.
(Reporting by Lisa Mattackal in Bengaluru; Editing by Pooja Desai)
Comments