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US stock futures leapt higher on Tuesday amid brighter prospects for an EU-US trade deal following President Trump’s decision to push back the introduction of 50% tariffs on imports from the bloc.
Dow Jones Industrial Average futures (YM=F) surged 1.3%, or over 550 points, while those on the S&P 500 (ES=F) jumped roughly 1.6%. Contracts of the tech-heavy Nasdaq 100 (NQ=F) led the advance, soaring 1.7%.
After Monday’s Memorial Day market closure, stocks are eyeing a comeback from Friday’s losses as investors welcomed signs of thawing in frosty US-EU trade relations. Another boost came from a slide in Treasury yields and a stronger dollar (DX=F), credited to signs that Japan is set to take action against relentless selling of its bonds.
CME – Delayed Quote USD
As of 6:12:52 AM EDT. Market Open.
ES=F NQ=F YM=F
The EU on Monday agreed to speed up tariff talks with the US, easing concerns about a trans-Atlantic trade war. The move followed Trump’s announcement on Sunday that the US would delay imposing a stepped-up 50% tariff on all EU products from June 1 until July 9, to allow time for negotiations.
Trump’s tariffs: Read the latest here
Investors are now turning their attention to a busy week of economic data, including reports on durable goods orders, housing, and consumer confidence. Market watchers will also hear from Federal Reserve officials who are expected to hold rates steady in line with previous direction. Trump’s contentious tax bill is also on the docket, having narrowly made it through the US House last week.
Meanwhile, Nvidia (NVDA) is set to take the spotlight on Wednesday with the quarter’s most anticipated earnings results. Okta (OKTA), Macy’s (M), and Costco (COST) are also set to report this week.
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Treasury yields slide as Japan looks to restore calm to its bond market
US Treasurys are rising alongside a rally in bonds worldwide amid signs that Japan is set to act to stabilize its bond market.
Yields on 30-year Treasurys (^TYX) fell as much as nine basis points to 4.95%, while benchmark 10-year yields (^TNX) dropped over four basis points to 4.47%. (Yields move inversely to bond prices.)
Japan is looking at issuing fewer superlong-dated bonds in the wake of recent sharp rises in yields for the notes, Reuters reported.
Bloomberg also reports:
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Asia-Pacific markets dip as investors weigh US tariff delay, BOJ signals rate hike
Asia-Pacific markets mostly declined Tuesday as investors digested the implications of US President Donald Trump’s decision to defer 50% tariffs on European Union imports, sparking fresh concerns about the global trade outlook.
Japan’s Nikkei 225 (^N225) slipped 0.2% to 37,451.60, while the broader Topix index was flat. The decline followed comments from Bank of Japan Governor Kazuo Ueda, who signaled that interest rate hikes could be on the horizon due to rising inflation.
Mainland China’s CSI 300 (83188.HK) dipped 0.6% despite data showing industrial profits rose 1.4% in April, up from 0.8% in March.
Hong Kong’s Hang Seng Index (^HSI) fell 0.2%.
South Korea’s Kospi (^KS11) dropped 0.6%, pulling back from a recent three-month high.
Meanwhile, Australia’s S&P/ASX 200 (^AXJO) rose 0.3%.
Investors remain cautious as global central banks balance inflation pressures with geopolitical uncertainty and trade volatility.
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Gold slips as EU-UK trade talks lower demand
Gold (GC=F) has continued to pull back after a remarkable year-to-date run. After tariff uncertainty shook riskier assets, burgeoning trade talks between the EU and the US have cut into the demand for haven commodities.
Bloomberg reports:
