Futures Pointing To Roughly Flat Open On Wall Street

The major U.S. index futures are currently pointing to a roughly flat open on Tuesday, with stocks likely to show a lack of direction after recovering from initial weakness to end the previous session mostly higher.

Traders may be reluctant to make significant moves as they await further developments on the trade front a month ahead of the expiration of President Donald Trump’s 90-day tariff pause.

While tensions between the U.S. and China have seemingly risen in recent days, traders appear to remain generally optimistic about trade deals being reached.

“The 90-day pause on tariffs has just over a month before expiration, meaning the pressure is on countries to do deals with the Trump administration,” said Russ Mould, investment director at AJ Bell.

He added, “Reports suggest that Trump wants best offers on trade negotiations by Wednesday, perhaps to avoid any last-minute rush or stalemate situations.”

Meanwhile, the Organization for Economic Co-operation and Development has lowered its global growth forecast for 2025 to 2.9 percent from 3.1 percent.

The Paris-based firm said the outlook across the globe has become challenging due to rising trade barriers and policy uncertainty, which is weighing on consumer confidence and blocking investments.

Stocks came under pressure early in the session on Monday but showed a notable turnaround over the course of the trading day. The major averages climbed well off their lows of the session and into positive territory.

The major averages saw further upside going into the end of the day, reaching new highs for the session. The Nasdaq climbed 128.85 points or 0.7 percent at 19,242.61, the S&P 500 rose 24.25 points or 0.4 percent to 5,935.94 and the Dow inched up 35.41 points or 0.1 percent to 42,305.38.

The early weakness on Wall Street partly reflected renewed trade concerns amid further signs of rising tensions between the U.S. and China.

China on Monday pushed back against President Donald Trump’s claims that it had broken the Geneva trade agreement, accusing the U.S. of violating the deal with increased tech export restrictions and the revocation of Chinese student visas.

“These practices seriously violate the consensus reached by the two heads of state on January 17, seriously undermine the existing consensus of the Geneva economic and trade talks, and seriously damage China’s legitimate rights and interests,” a Chinese Ministry of Commerce spokesperson said.

A collapse of the U.S.-China trade agreement could lead to considerable weakness among stocks, which have shown a considerable recovery since Trump’s “reciprocal tariff” announcement in early April.

The Trump administration has also announced it will double the current tariff rate on steel and aluminum imports from 25 percent to 50 percent.

However, selling pressure waned following the release of a report from the Institute for Supply Management showing its reading on U.S. manufacturing activity unexpectedly edged slightly lower in the month of May.

The ISM said its manufacturing PMI slipped to 48.5 in May from 48.7 in April, with a reading below 50 indicating contraction. Economists had expected the index to inch up to 49.5.

With the unexpected decline, the manufacturing PMI dipped to its lowest level hitting 48.4 in November 2024.

The report may have generated some optimism about the outlook for interest rates amid signs of U.S. economic weakness due to Trump’s trade war.

The turnaround on Wall Street also came after a White House official told CNBC that Trump and Chinese President Xi Jinping could speak one-on-one “very soon.”

Gold stocks moved sharply higher along with the price of the precious metal, with the NYSE Arca Gold Bugs Index soaring by 6.0 percent.

Trump’s increased tariffs on U.S. steel imports also contributed to substantial strength among steel stocks, as reflected by the 3.0 percent surge by the NYSE Arca Steel Index.

Semiconductor, natural gas and oil service stocks also moved notably higher over the course of the session, while some weakness remained visible among housing stocks.

Commodity, Currency Markets

Crude oil futures are jumping $0.82 to $63.34 a barrel after surging $1.73 to $62.52 a barrel on Monday. Meanwhile, after spiking $81.70 to $3,370.60 an ounce in the previous session, gold futures are falling $19.10 to $3,351.50 an ounce.

On the currency front, the U.S. dollar is trading at 143.32 yen compared to the 142.71 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.1383 compared to yesterday’s $1.1441.

Asia

Asian stocks ended mixed on Tuesday despite the White House flagging imminent trade talks with China and calling for best-offer proposals from trade partners to fast-track trade negotiations.

The dollar recovered slightly and gold slipped from a nearly four-week high hit the previous day, while oil prices continued their sharp rise due to escalating geopolitical tensions, stalled Iran nuclear talks and wildfire-related supply disruptions.

China’s Shanghai Composite Index rose 0.4 percent to 3,361.98 as weak PMI data as well as looming trade risks spurred stimulus hopes.

Chinese manufacturing activity in May shrank at its fastest pace since September 2022, a private survey showed earlier today.

Hong Kong’s Hang Seng Index rallied 1.5 percent to 23,512.49, led by tech stocks, with Tencent and Alibaba rising around 1 percent.

Japanese markets gave up early gains to end on a flat note ahead of a fifth round of ministerial-level talks in the U.S. to be held this week.

The Nikkei 225 Index finished marginally lower at 37,446.81, while the broader Topix Index settled 0.2 percent lower at 2,771.11.

A firmer yen weighed on the auto sector, with Honda and Mitsubishi Motors falling around 1 percent each. Chip-related stocks followed their U.S. peers higher, with Nvidia supplier Advantest climbing 2.6 percent and Screen Holdings adding 1.4 percent.

Seoul stocks ended marginally higher after a choppy session due to tariff woes and amid anxiety on the eve of the presidential election triggered by former president Yoon Suk Yeol’s impeachment over his failed martial law bid. Market bellwether Samsung Electronics and SK Hynix both rose over 1 percent.

Australian markets rose notably to hit a three-month high on optimism surrounding possible U.S.-China trade discussions.

Investors also reacted to the Reserve Bank of Australia’s May meeting minutes that showed the board preferred policy to be cautious and predictable.

The benchmark S&P/ASX 200 Index gained 0.6 percent to close at 8,466.70, with banks and miners leading the way higher. The broader All Ordinaries Index ended 0.6 percent higher at 8,690.90.

Across the Tasman, New Zealand’s benchmark S&P/NZX-50 Index fell 0.7 percent to 12,327.23 as investors returned from a long weekend.

Europe

European shares are turning in a mixed performance on Tuesday as trade tensions persist and investors look ahead to the European Central Bank’s policy meeting later in the week.

Meanwhile, the Organization for Economic Co-operation and Development lowered its global growth forecast to 2.9 percent from its earlier forecast of 3.1 percent for 2025.

The Paris-based firm said the outlook across the globe has become challenging due to rising trade barriers and policy uncertainty, which is weighing on consumer confidence and blocking investments.

While the French CAC 40 Index is down by 0.2 percent, the German DAX Index is up by 0.1 percent and the U.K.’s FTSE 100 Index is up by 0.2 percent.

Julius Baer shares have moved sharply lower. The Swiss bank said it would step up a cost-saving drive to target SFr130mn ($159mn) in cuts by 2028.

British American Tobacco, the maker of Lucky Strike and Dunhill cigarettes, has also dipped despite raising its annual sales target.

Water utility Pennon has also shown a notable move to the downside after it swung to an annual pretax loss.

Meanwhile, Sanofi has jumped after the U.S. FDA granted orphan drug designation to rilzabrutinib for sickle cell disease.

U.S. Economic News

The Commerce Department is scheduled to release its report on new orders for manufactured goods in the month of April at 10 am ET. Factory orders are expected to tumble by 3.0 percent in April after surging by 3.4 percent in March.

Also at 10 am ET, the Labor Department is due to release its report on job openings in the month of April. Job openings are expected to decrease to 7.100 million in April after falling to 7.192 million in March.

Chicago Federal Reserve President Austan Goolsbee is scheduled to participate in a moderated question-and-answer session before the 2025 Corridor Business Journal Mid-Year Economic Review at 12:45 pm ET.

At 1 pm ET, Federal Reserve Board Governor Lisa Cook is due to speak on the economic outlook at the Peter McColough Series on International Economics.

Dallas Federal Reserve President Lorie Logan is scheduled to deliver opening remarks and moderates a discussion before a Fed Listens roundtable with El Paso community leaders at 3:30 pm ET.