US stock futures saw a rise after Commerce Secretary Howard Lutnick suggested that President Donald Trump might offer a way to reduce tariffs for Canada and Mexico as early as Wednesday.
Market Futures Show Positive Movement
Futures linked to the tech-heavy Nasdaq (NQ=F) and the benchmark S&P 500 (ES=F) gained 0.6%. Meanwhile, futures for the Dow Jones Industrial Average (YM=F) rose by 0.5%.
Lutnick’s comments on Fox Business Network sparked optimism among investors, fueling hopes that Trump might reconsider broad tariffs on the US’s primary trading partners. This came after a turbulent market reaction to the new tariffs imposed on Tuesday.
Stock Market Reaction to Tariffs
Following Trump’s announcement of 25% tariffs on Canada and Mexico and doubling duties on China, the S&P 500 wiped out its post-election gains, and the Dow Jones Industrial Average dropped more than 650 points.
In response, the affected countries took immediate action. Canada introduced tariffs on billions of dollars of US goods, China imposed up to 15% tariffs on US farm products starting Monday, and Mexico announced it would unveil its own retaliatory tariffs later this week.
What’s Next for the Trade War?
Traders will be closely watching for more information on Trump’s next steps in the ongoing trade conflict. The president is expected to address Congress on Tuesday night, which could offer further clarity.
Additionally, the ADP National Employment Report on Wednesday will provide a glimpse into private payroll growth. Retailer Abercrombie & Fitch (ANF) is also scheduled to report its earnings.
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