US stock futures flounder amid tech weakness, Fed caution
Investing.com -- The S&P 500 closed lower Tuesday after hitting a fresh record high intraday as investors digested a deluge of more corporate earnings and uncertainty over the outcome of U.S.-China trade talks.
At 4:00 p.m. ET (20:00 GMT), theDow Jones Industrial Average fell 204 points, or 0.5%, the S&P 500 index fell 0.3% after hitting an intraday all-time high of 6,409.26 and the NASDAQ Composite fell 0.4%.
The main benchmark U.S. indices have been on the rise following the weekend announcement of a trade agreement between the U.S. and European Union.
U.S.-China trade talks continue stoke uncertainty
U.S. trade representative Jamieson Greer said Tuesday that talks with China were "going in the right direction," but stopped short of offering any clue as to whether both parties are closer to a deal nor whether extensions to current truce would continue.
If the pause on China tariffs aren’t extended, goods from China would be subject to the April 2 liberation day levels.
Both sides had previously agreed on preliminary trade pacts earlier this year which cooled an intensifying trade war marked by rapidly escalating tit-for-tat tariffs and the squeezing-off of crucial rare earth minerals exports.
Fed meeting starts
The Fed has started its latest two-day policy meeting, and while rates are expected to stay at 4.25%–4.5% when the announcement is made on Wednesday, investors will watch closely for signals on a possible cut later this year.
Fed chair Jerome Powell has recommended a wait-and-see attitude as the policymakers await more clarity around the impact of the Trump administration’s aggressive tariff agenda, but there have been signs of dissent within the FOMC, with a couple of members recently calling for lower rates.
U.S. President Donald Trump on Monday again called on the Federal Reserve to cut interest rates, saying it would help propel the U.S. economy.
The Bank of Japan also holds a key meeting on Thursday, where it is expected to keep rates unchanged.
Tariffs and their inflation impact will be in focus Thursday with the release of June’s PCE price index, the Fed’s preferred inflation gauge.
Investors will also watch key labor data this week, including JOLTS Job Openings later in the session, ADP private payrolls on Wednesday, jobless claims on Thursday, and the key July jobs report on Friday.
Earnings continue to flow
Investors are also gearing up for the busiest week of the earnings season, with more than 150 companies in the S&P 500 due to post their quarterly results.
This includes “Magnificent Seven” members, Facebook-owner Meta Platforms (NASDAQ:META) and Microsoft (NASDAQ:MSFT) on Wednesday, followed by Apple (NASDAQ:AAPL) and Amazon (NASDAQ:AMZN) on Thursday.
Elsewhere, Merck (NYSE:MRK) stock fell after the drugs giant announced job and cost cuts it said will save $3 billion a year as it posted lower second-quarter results due to continuing weak demand for its Gardasil vaccine in China.
Novo Nordisk (NYSE:NVO) stock slumped after the maker of weight-loss drug Wegovy warned that full-year sales and operating profit would grow less than previously expected, marking its second forecast cut of 2025.
PayPal (NASDAQ:PYPL) stock fell after the payments company guided to a current-quarter profit that was roughly flat from a year earlier, even as it raised its full-year profit forecast.
United Parcel Service (NYSE:UPS) stock fell 10.6% after the parcel delivery service reported a decline in second-quarter profit and revenue, as demand took a hit from the Trump administration’s volatile trade policies.
Unitedhealth (NYSE:UNH) stock fell after the health insurer reinstated the full-year profit forecast that it pulled over two months ago, but its guidance still fell short of analysts’ already-lowered expectations.
Whirlpool (NYSE:WHR) stock plunged after the home appliance company reporting disappointing second-quarter results and slashed its 2025 full-year guidance.
Visa (NYSE:V) will highlight the docket of returns after U.S. markets close.
Peter Nurse, Ayushman Ojha contributed to this article