U.S. equity futures edged modestly lower Wednesday, while Treasury yields and the dollar moved higher, as investors paused a record-setting rally on Wall Street amid renewed tariff and inflation concerns.
Stocks posted only meagre gains yesterday, but enough to lift the S&P 500 to another record high close that takes the benchmark’s 2025 gain to just over 4.2%, as investors returned from the Presidents’ Day weekend.
Solid corporate earnings, steady Treasury yields and an underlying economy growth north of 2% have all combined to keep Wall Street’s bullish momentum on track, even with the so-called Magnificent 7 tech stocks lagging their smaller peers over the first six week of the year.Â
President Trump’s tariff plans, however, remain a lingering risk for the market, and comments from his Mar-a-Lago estate last night, which suggested a levy of “25% of higher” on autos, semiconductors and pharmaceutical imports were a reminder that his April 2 deadline for reciprocal duties on U.S. trade partners is fast-approaching.Â
Treasury yields jumped in the wake of his remarks, with benchmark 10-year notes rising 5 basis points to 4.566% in overnight trading 2-year notes edging higher to 4.302%.
The U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 0.11% higher at 107.177 heading into the New York trading session following some hawkish comments from San Francisco Fed President Mary Daly on Tuesday.
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Wall Street is looking at a relatively muted session, in terms of headline risks, with January housing starts data at 8:30 am Eastern time and minutes of the Federal Reserve’s January policy meeting slated for release at 2:00 pm Eastern time.Â
Futures contracts tied to the S&P 500 suggest a modest 9 point decline at the start of trading, with the Dow Jones Industrial Average priced for a 62 point dip.
The tech-focused Nasdaq, meanwhile, is called 27 points lower with Nvidia (NVDA) , Tesla (TSLA)  and Intel (INTC)  active in premarket trading.Â
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In overseas markets, Europe’s Stoxx 600 edged 0.04% lower in mid-day Frankfurt trading, while a faster-than-expected January inflation reading of 3% in Britain tested Bank of England rate cut bets and pushed the FTSE 100 0.24% lower in London.Â
Overnight in Asia, Japan’s Nikkei 225 fell 0.27%, with auto stocks pacing the decline in the way of Trump’s tariff remarks, while the regional MSCI ex-Japan benchmark edged 0.11% lower into the close of trading.
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