U.S. Stock Futures Decline Amid Tariff Concerns

Market Performance Highlights

The S&P 500 ended its impressive nine-day winning streak, with premarket activity on Tuesday indicating declines across major indices. Futures for the S&P 500, Dow Jones Industrial Average, and Nasdaq 100 were all lower, reflecting cautious sentiment among investors. Energy and technology sectors were among the leading contributors to Monday's losses, while the consumer staples sector displayed resilience and recorded slight gains. Despite the pullback, the S&P 500 remains up nearly 3% for the week, while the Nasdaq and Dow also posted gains of 3.4% and 3%, respectively, for the same period.

Impact of Tariff Announcements

Recent tariff-related announcements have reignited concerns over the U.S. trade policy's impact on markets. President Trump's proposal of a 100% tariff on foreign films and potential levies on pharmaceutical imports have added uncertainty, undermining market optimism about near-term trade deal resolutions. Analysts argue that expectations of significant trade progress may be premature, especially given the lack of concrete outcomes. The announcement of additional tariffs has also raised questions about the sustainability of recent market rallies, with sectors like consumer goods and healthcare potentially facing increased pressure.

Focus on Federal Reserve and Economic Indicators

The Federal Reserve's two-day policy meeting, starting Tuesday, has captured market attention. The central bank is widely expected to maintain current interest rates, as reflected in CME Group's FedWatch tool, which places a 96.8% probability on this outcome. Investors are particularly focused on Chair Jerome Powell's remarks for insights into the Fed's assessment of economic conditions. On the data front, the labor market remains robust, with April's jobs report showing solid performance. Additionally, the ISM services PMI exceeded expectations, rising to 51.6 in April from 50.8 in March, indicating resilience in the services sector despite broader economic uncertainties.

Key Corporate Developments

Ford Motor Company has withdrawn its 2025 guidance, citing an anticipated $1.5 billion hit from tariffs, which led to a premarket decline of 2.6% in its shares. In the tech sector, notable earnings reports are expected from companies like Advanced Micro Devices (AMD), Super Micro Computer (SMCI), and Rivian Automotive (RIVN). Meanwhile, Palantir Technologies' stock dropped 9.2% after posting earnings that met profit expectations but fell short on revenue growth, disappointing investors. Other corporate updates include DoorDash's announcement of a $3.86 billion acquisition of Deliveroo, signaling continued consolidation in the food delivery industry.