Bargain Hunting May Contribute To Initial Rebound On Wall Street

The major U.S. index futures are currently pointing to a slightly higher open on Tuesday, with stocks likely to regain ground following the sell-off seen in the previous session.

Traders may look to pick up stocks at reduced levels following yesterday’s slump, which dragged the Dow down to its lowest closing level in a month.

Buying interest may be somewhat subdued, however, as uncertainty about tariffs continues to weigh on investors’ minds.

Traders may also be reluctant to make significant moves ahead of the release of quarterly results from AI chipmaker and market leader Nvidia (NVDA) are the close of Wednesday’s trading.

“Investors have plenty to worry about, and Nvidia’s results on Wednesday have the potential to make or break the market depending on what it says about AI,” said Dan Coatsworth, head of markets at AJ Bell.

He added, “The market has this year shown widespread concerns about all things linked to AI, from excessive spending to business models being disrupted, so Nvidia needs to retain its uber-bullish stance if it wants to avoid stirring the pot of worry for investors.”

After turning in a strong performance last week, stocks moved sharply lower during trading on Monday. The major averages all showed significant moves to the downside, with the Dow tumbling to its lowest closing level in a month.

The major averages ended the day off their lows of the session but still firmly negative. The Dow slumped 821.91 points or 1.7 percent to 48,804.06, the Nasdaq slid 258.80 points or 1.1 percent to 22,627.27 and the S&P 500 declined 71.76 points or 1.0 percent to 6,837.75.

The sell-off on Wall Street came amid renewed trade uncertainty following the Supreme Court’s decision last Friday striking down most of President Donald Trump’s sweeping global tariffs.

Trump announced in a post on Truth Social on Saturday that he would be raising worldwide tariffs to the “fully allowed” and “legally tested” 15 percent level from the 10 percent he announced shortly after the ruling.

“During the next short number of months, the Trump Administration will determine and issue the new and legally permissible Tariffs, which will continue our extraordinarily successful process of Making America Great Again – GREATER THAN EVER BEFORE!!!” Trump said.

While a fact sheet from the White House acknowledged the president is only allowed to impose the tariffs for a period of 150 days without congressional approval, Trump claimed in a subsequent post that he does not need to go back to Congress for approval.

Trump also said any country that wants to “play games” will be met with a “much higher Tariff, and worse, than that which they just recently agreed to.”

Meanwhile, the European Commission issued a statement requesting “full clarity” on the steps the U.S. intends to take following the Supreme Court decision.

The European Commission called the current situation “not conducive” to delivering “fair, balanced, and mutually beneficial” transatlantic trade and investment, as agreed to by both sides and spelled out in the EU-U.S. Joint Statement of August 2025.

“A deal is a deal,” the European Commission said. “As the United States’ largest trading partner, the EU expects the U.S. to honour its commitments set out in the Joint Statement – just as the EU stands by its commitments.”

Negative sentiment was also generated in reaction to a nosedive by shares of IBM Corp. (IBM), with the tech giant plummeting by 13.2 percent.

IBM came under pressure after Anthropic’s Claude announced COBOL capabilities. COBOL is a programming language used widely in business data processing, which is a core business area for IBM.

Financial stocks turned in some of the market’s worst performances on the day, with the KBW Bank Index and the NYSE Arca Securities Broker/Dealer Index plunging by 4.4 percent and 3.4 percent, respectively.

Substantial weakness was also visible among software stocks, as reflected by the 3.9 percent nosedive by the Dow Jones U.S. Software Index.

Airline, computer hardware and networking stocks also saw significant weakness, while gold stocks bucked the downtrend amid a sharp increase by the price of the precious metal.

Commodity, Currency Markets

Crude oil futures are jumping $0.83 to $67.14 a barrel after slipping $0.17 to $66.31 a barrel on Monday. Meanwhile, after surging $144.70 to $5,225.60 an ounce in the previous session, gold futures are slumping $70 to $5,155.60 an ounce.

On the currency front, the U.S. dollar is trading at 156.04 yen compared to the 154.62 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is trading at $1.1769 compared to yesterday’s $1.1784.

Asia

Asian stocks ended mostly higher on Tuesday as traders evaluated the potential turbulence in the trade environment following the U.S. Supreme Court’s ruling on reciprocal tariffs.

It is believed that a uniform 15 percent tariff, announced by U.S. President Donald Trump, would benefit some Asia-Pacific economies that have faced much steeper tariff rates.

But the uncertainty may worsen if the Trump administration continues imposing new tariffs under alternative laws.

On Monday, Trump warned countries against backing away from recently negotiated trade deals, saying that he would hit them with much higher duties under different trade laws.

Gold prices retreated from a three-week high in Asian trading due to an uptick in the U.S. dollar index. Oil prices edged up on supply concerns as Trump reiterated his preference for a deal with Iran but warned of consequences if upcoming nuclear talks fail.

China’s Shanghai Composite Index advanced 0.9 percent to 4,117.41 as the People’s Bank of India kept its benchmark lending rates unchanged for a ninth straight month to maintain currency stability.

The yuan rose to a nearly three-year high after the U.S. court tariff reprieve. China has called on the United States to rescind unilateral tariffs and warned of countermeasures after Trump announced a new 15 percent global tariff.

Hong Kong’s Hang Seng Index slumped 1.7 percent to 26,619.10, retreating from a nearly two-week high reached the previous day due to technology sector weakness and AI-related investor concerns.

Japanese markets advanced as traders returned from a holiday. The Nikkei 225 Index jumped 0.9 percent to 57,321.09, with fiber-cable makers leading the surge on talk of bigger AI infrastructure spending. Shares of Furukawa Electric soared 15.3 percent.

Defense stocks underperformed after China’s commerce ministry banned selling “dual-use” goods to a list of Japanese companies over worries of military use.

Seoul stocks notched another record high, driven by strong gains in the technology sector ahead of an earnings report from U.S. chipmaker Nvidia later this week.

The Kospi surged 2.1 percent to a new record high of 5,969.64 despite steep overnight losses on Wall Street. Market bellwether Samsung Electronics rallied 3.6 percent while chip giant SK Hynix surged 5.7 percent to a record high.

Australian markets ended a choppy session marginally lower as tech stocks declined, offsetting strength in energy and mining stocks.

Across the Tasman, New Zealand’s benchmark S&P/NZX-50 Index climbed 0.8 percent to 13,532.31, extending gains from the previous session.

Europe

European stocks are turning in a lackluster performance on Tuesday, with a resurgence in trade uncertainty coupled with artificial intelligence disruption concerns keeping investors on edge.

Amid anxieties over Iran, tariffs and the economic outlook, investors now await U.S. President Donald Trump’s State of the Union speech to Congress for direction.

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

Banks traded lower, with Commerzbank, Deutsche Bank and BNP Paribas falling 1-2 percent on concerns about the expected long-run effects of AI on the broader economy, including jobs, consumer behavior, economic growth, earnings and stock markets.

Automakers were broadly higher, with BMW, Mercedes Benz, Volkswagen and Renault all rising over 1 percent, despite the release of new data that showed new car sales in Europe fell year-on-year in January for the first time since June.

Spanish telecoms giant Telefonica rose nearly 2 percent after its core profit growth picked up pace in the fourth quarter.

French vouchers and benefit cards provider Edenred soared 7 percent after beating 2025 core profit estimates.

Solvay shares rallied 3.4 percent. The Belgian chemical group reported fourth-quarter adjusted earnings that came in ahead of analyst estimates.

U.S. Economic News

Standard & Poor’s is due to release its report on home prices in major metropolitan areas in the month of December at 9 am ET. The annual rate of home price growth is expected to inch up to 1.5 percent in December from 1.4 percent in November.

Also at 9 am ET, Atlanta Federal Reserve President Raphael Bostic is scheduled to participate in a conversation on monetary policy, the economic outlook and personal reflections before an event hosted by Marketplace.

Boston Federal Reserve President Susan Collins is also due to deliver opening remarks before the “Technology-Enabled Disruption: Shaping the Future of Finance and Payments” conference at 9 am ET.

At 9:15 am ET, Federal Reserve Governor Christopher Waller is scheduled to speak on technology before the “Technology-Enabled Disruption: Shaping the Future of Finance and Payments” conference.

Federal Reserve Governor Lisa Cook is due to speaks on artificial intelligence and productivity before the National Association for Business Economics (NABE) 42nd Annal Economic Policy Conference at 9:30 am ET.

At 10 am ET, the Conference Board is due to release its report on consumer confidence in the month of February. The consumer confidence index is expected to jump to 88.0 in February from 84.5 in January.

Richmond Federal Reserve President Thomas Barkin and Boston Federal Reserve President Susan Collins are scheduled to participate in panel discussion before the “Technology-Enabled Disruption: Shaping the Future of Finance and Payments” conference at 3:15 pm ET.