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U.S. stock futures traded cautiously on Friday, as market participants held back ahead of a key round of trade negotiations between Washington and Beijing this weekend, following Thursday’s optimism surrounding a U.S.-U.K. trade agreement.
At 05:45 ET (09:45 GMT), Dow Jones Futures dipped 14 points, or 0.1%, while S&P 500 Futures edged up 8 points, or 0.1%. Nasdaq 100 Futures gained 50 points, or 0.2%, bolstered by tech-related sentiment.
All three major Wall Street indices closed higher on Thursday, buoyed by easing trade tensions. The Dow Jones Industrial Average rose 0.6%, the S&P 500 gained 0.6%, and the NASDAQ Composite climbed 1.1%.
U.S.-U.K. Deal Sparks Optimism Ahead of China Talks
Thursday’s announcement of a trade framework between the United States and the United Kingdom bolstered investor confidence that President Donald Trump’s hardline tariff policy may be entering a more measured phase. The agreement maintained a 10% tariff on U.K. goods but reduced U.K. tariffs to 1.8% from 5.1% and included exemptions for steel and aluminum imports.
The structure of the deal has raised hopes that it could serve as a model for further trade agreements, particularly as U.S. Treasury Secretary Scott Bessent prepares to meet China’s Vice Premier He Lifeng in Switzerland this weekend. Investors will be watching closely for signs of de-escalation in the prolonged trade war that has rattled markets and weighed on global growth.
Fed Speakers Take the Spotlight
With a quiet economic calendar on Friday—limited to the release of the April federal budget balance—attention will turn to comments from Federal Reserve policymakers. Vice Chair for Supervision Michael Barr and Governor Christopher Waller, both viewed as dovish-leaning, are expected to speak later in the day.
Markets are still digesting the Fed’s decision earlier this week to hold interest rates steady, with Chair Jerome Powell emphasizing economic uncertainty and limited visibility on inflation trends.
Nvidia Adjusts China Strategy Amid Export Curbs
On the corporate front, Nvidia (NASDAQ:NVDA) may draw fresh scrutiny following reports that it is preparing a toned-down version of its H20 AI chip for China. The move comes as the chipmaker navigates increasingly stringent U.S. export controls aimed at curbing advanced technology access for Beijing.
According to a Reuters report, the modified chip is expected to launch within two months and is designed to comply with regulations imposed by both the Biden and Trump administrations. The latter has signaled further clampdowns on tech exports, including license requirements for advanced AI hardware.
Nvidia’s stock has been closely watched this year as a proxy for AI enthusiasm and U.S.-China tech decoupling. Any adjustment in the company’s China strategy could influence broader sentiment in the tech sector.
Investors are likely to remain cautious through Friday’s session, awaiting the outcome of the U.S.-China trade talks. While the U.S.-U.K. deal has provided a dose of optimism, markets are still navigating a complex macro landscape, with central bank uncertainty, fragile global growth, and persistent geopolitical risks in play.
