Wall Street Set for Higher Open on Tariff Report: Markets Wrap

(Bloomberg) — Wall Street was set for a higher open on Tuesday, though a renewed rise in Treasury yields damped the sentiment boost offered earlier by the prospect of gradually imposed US trade tariffs.

Contracts on the Nasdaq 100 and the S&P 500 were up 0.2%, off their highs for the session. Futures had earlier climbed as much as 0.8% after Bloomberg News reported that the incoming Donald Trump administration is considering tariff hikes of about 2% to 5% a month, rather than aggressive one-time increases. 

That strategy, said to be aimed at averting inflation spikes, knocked the dollar as much as 0.4% lower, snapping a five-day rising streak. Treasuries, however, gave up earlier gains, with yields up 1.5 basis points and near the October 2023 highs hit Monday. In Britain, the government paid the most in decades to sell 30-year inflation-linked debt. 

Michael Brown, a strategist at Pepperstone Group Ltd., described the mood as cautiously optimistic, given that “a slower and steadier tariff approach would perhaps remove a degree of upside inflation risk and a degree of downside growth risk.”

He noted, however, that selling pressure appeared be returning, with traders mindful that Trump has previously dismissed suggestions of a more moderate tariff approach. Markets are also jittery about imminent economic data, including Tuesday’s US producer inflation print, followed by a CPI report and retail sales numbers later this week. 

“Considering the event risk that we’ve got on the horizon, conviction seems a little bit lacking. That’s perhaps why we are seeing some of the initial optimism fade a little bit,” Brown added.

The latest word on tariffs comes at a time when markets are increasingly fearful of an inflation resurgence that prevents central banks, especially the Fed, from cutting rates as much as expected earlier. Policies espoused by Trump, including mass deportations and higher trade levies, have fanned such concerns. 

That makes this week’s US inflation data all the more crucial, especially if it signals the disinflation trajectory had already stalled at the end of last year. 

Focus is also turning to the US corporate earnings season, with banks including Citigroup Inc., JPMorgan Chase & Co. and Goldman Sachs Group Inc. reporting on Wednesday. Fourth-quarter earnings-per-share on the S&P 500 is expected to climb 7.3% from the year-earlier period, according to data compiled by Bloomberg Intelligence.

Recent losses on the S&P 500 have wiped out its 2025 gains, with sentiment also hurt by the prospect of sweeping new limits on the sale of advanced AI chips by Nvidia Corp. and its peers. In premarket trading, most Magnificent Seven tech names were higher on the day, while in Europe, the Stoxx 600 index was up 0.3%.

“There’s been a swing back from the exuberance of the Trump election,” said Raphael Thuin, head of capital market strategies at Tikehau Capital in Paris. “The market is hoping for the upcoming earnings season to provide some reassurance.” 

Key events this week:

• US PPI, Tuesday
• Fed’s John Williams and Jeffrey Schmid speak, Tuesday
• Eurozone industrial production, Wednesday
• Citigroup, JPMorgan, Goldman Sachs, BNY, Wells Fargo and BlackRock earnings, Wednesday
• US CPI, Empire manufacturing, Wednesday
• Fed’s John Williams, Tom Barkin, Austan Goolsbee and Neel Kashkari speak, Wednesday
• TSMC earnings, Thursday
• ECB releases account of December policy meeting, Thursday
• Bank of America, Morgan Stanley earnings, Thursday
• US initial jobless claims, retail sales, import prices, Thursday
• China GDP, property prices, retail sales, industrial production, Friday
• Eurozone CPI, Friday
• US housing starts, industrial production, Friday

Some of the main moves in markets:

Stocks

• S&P 500 futures rose 0.2% as of 8:03 a.m. New York time
• Nasdaq 100 futures rose 0.2%
• Futures on the Dow Jones Industrial Average rose 0.2%
• The Stoxx Europe 600 rose 0.4%
• The MSCI World Index was little changed

Currencies

• The Bloomberg Dollar Spot Index fell 0.2%
• The euro was little changed at $1.0252
• The British pound fell 0.3% to $1.2166
• The Japanese yen fell 0.2% to 157.73 per dollar

Cryptocurrencies

• Bitcoin rose 1.8% to $95,891.07
• Ether rose 2.1% to $3,181.01

Bonds

• The yield on 10-year Treasuries was little changed at 4.78%
• Germany’s 10-year yield advanced one basis point to 2.62%
• Britain’s 10-year yield was little changed at 4.88%

Commodities

• West Texas Intermediate crude fell 0.7% to $78.27 a barrel
• Spot gold rose 0.3% to $2,670.28 an ounce

This story was produced with the assistance of Bloomberg Automation.

 

–With assistance from Aya Wagatsuma and Margaryta Kirakosian.

©2025 Bloomberg L.P.