Noor Trends News, Technical Analysis, Educational Tools and Recommendations
U.S. stock index futures edged slightly lower early Wednesday, as investor enthusiasm over a newly proposed U.S.-China trade framework faded and attention shifted to critical U.S. inflation data due later in the day.
As of 05:40 ET (09:40 GMT):
- Dow Jones Futures dropped 50 points (−0.1%)
- S&P 500 Futures fell 7 points (−0.1%)
- Nasdaq 100 Futures slipped 35 points (−0.2%)
Wall Street Recap: Tesla Leads Gains
On Tuesday, the major U.S. indices closed higher for a third consecutive session, with:
- The Nasdaq Composite up 0.6%
- The Dow Jones Industrial Average rising 0.3%
- The S&P 500 climbing 0.6%, now trading less than 2% below its February peak
A significant portion of the gains was driven by a sharp rally in Tesla (NASDAQ: TSLA) shares, adding momentum to the broader tech space.
U.S.-China Trade Framework: Light on Details
Markets initially welcomed news that U.S. and Chinese officials had reached a framework to resolve key trade disputes after two days of talks in London. The deal reportedly includes:
- The U.S. easing chip export restrictions
- China increasing rare earth shipments
However, investors remain cautious, as the framework lacks concrete terms and still awaits formal approval from Presidents Trump and Xi. Market skepticism is further fueled by memories of past truce failures, such as the Geneva agreement.
Adding to uncertainty, a U.S. federal appeals court upheld Trump’s “liberation day” tariffs, allowing steep levies to remain in place pending review. The move signals ongoing protectionist policies that could disrupt global trade flows.
Focus Turns to May CPI Inflation Data
All eyes now turn to the Consumer Price Index (CPI) data from the U.S. Labor Department, scheduled for release later today. Expectations are:
- Headline CPI (YoY): 2.5% (vs. 2.3% prior)
- Core CPI (YoY): 2.9%
- Monthly core CPI: 0.3%
- Monthly headline CPI: 0.2%
While Trump has delayed some retaliatory tariffs, analysts warn that tariff-driven inflation risks remain, especially on imported goods and materials. Sticky inflation could reduce the likelihood of Federal Reserve rate cuts, adding pressure to equity valuations.
Earnings Watch: Oracle in Focus
On the earnings front:
- Chewy (NYSE: CHWY) and Victoria’s Secret (NYSE: VSCO) report before the bell.
- Oracle (NYSE: ORCL) reports after market close.
Investors will be watching Oracle closely for insights into:
- Cloud and AI growth
- Cash flow performance, with Wall Street projecting ~$3B in free cash flow and ~$3.8B in capital expenditures
Oracle’s AI integration into its cloud business is a focal point of its long-term growth strategy, as outlined by CEO Safra Catz.
Crude Oil Holds Steady as Trade Optimism Supports Demand Outlook
Oil prices remained steady in early Wednesday trade:
- Brent crude: $66.78 (−0.1%)
- WTI crude: $64.98 (flat)
Optimism over a potential U.S.-China trade agreement has helped calm demand concerns. A freer trade environment is seen as supportive of global energy consumption.
The EIA’s official crude inventory report is due later in the day, following API data showing a 370,000-barrel drawdown in U.S. stockpiles.
Summary: U.S. futures reflect a cautious tone as markets await inflation clarity and remain skeptical of the U.S.-China trade framework’s durability. Key CPI data and earnings from major firms like Oracle will set the tone for the rest of the trading session.
