Market Jitters: Trump’s Tariff Plans Send Futures Sliding
As investors digested a report that President-elect Donald Trump is considering declaring a national economic emergency to pave the way for proposed tariffs, US stock futures took a hit on Wednesday. The news sparked a reversal in earlier pre-market gains, with S&P 500 futures and Nasdaq 100 futures each shedding around 0.3%. Dow Jones Industrial Average futures also moved down 0.2%.
Tariff Threat Looms Large
Trump’s potential use of emergency powers to justify hefty and wide-ranging tariffs has markets on high alert. With Inauguration Day nearing, investors are bracing for a wave of policy moves and executive orders that could impact the economy. The 10-year Treasury yield jumped to around 4.72%, holding near eight-month highs, as investors reassessed the chances of slower interest-rate cuts this year.
Economic Data Takes Center Stage
Fresh jobs data and Federal Reserve minutes due later on Wednesday could reset investor bets. On Tuesday, stocks sold off and the benchmark Treasury yield spiked as service sector and labor market readings revived concerns over stubborn inflation. The data gives weight to Fed officials’ hints that they will lower rates slower than foreseen, and traders now see a less than 50% chance of any easing before June.
Key Data Releases Ahead
An ADP update on private payrolls in December and minutes from Fed policymakers’ latest meeting are due later on Wednesday. The data will feed into expectations for the crucial December jobs report release on Friday. Meanwhile, Nvidia stock struggled to recover from a rout that erased $220 billion in market value.
Earnings and Economic News
Earnings reports are due from Albertsons, Helen of Troy, and Jefferies. On the economic front, MBA mortgage applications, initial jobless claims, and ADP private payrolls data will be released. Additionally, minutes from the FOMC December meeting will provide insight into the Fed’s thinking on interest rates.
Leave a Reply