The market rally was set to resume after a tech-driven stumble but tariff talks and coming Tesla deliveries were keeping investors on edge.
U.S. stock futures were rising across the three main indexes. Dow Jones Industrial Average futures were up 111 points, or 0.3%. S&P 500 futures were rising 0.3% and Nasdaq 100 futures were climbing 0.3%. The S&P 500 and Nasdaq fell back from record highs on Tuesday, hit by a fall in technology stocks as Tesla dropped more than 5%.
Tesla will continue to be in focus as the electric-vehicle company’s investors fret about the continuing feud between Elon Musk and President Donald Trump over the former’s attacks on the president’s tax-and-spending bill. The legislation was passed by the Senate on Tuesday by a vote of 51-50, with Vice President JD Vance casting the tie-breaking vote.
The bill extends $3.8 trillion in individual tax cuts, while establishing new breaks for corporations, tips, and overtime, but faces an uncertain future in the House of Representatives.
“Despite the Congressional Budget Office now estimating an upwardly-revised $3.3 trillion addition to net debt over the next decade, the reaction in Treasuries has been muted, likely cushioned by hopes of earlier Fed easing,” wrote ING analyst Francesco Pesole in a research note on Wednesday. “Still, if inflation surprises on the upside, a delayed impact on US bonds cannot be ruled out.”
The yield on the benchmark 10-year Treasury stood at 4.260% early on Wednesday, ticking up from the previous day. Federal Reserve Chair Jerome Powell was asked during a central banking forum in Portugal on Tuesday whether July is too soon to consider easing rates. He avoided a direct answer, but signaled a cautious, data-dependent approach.
“Powell refused to rule out a July rate cut, so a sharp payrolls miss tomorrow [Thursday] would give markets license to price in easing as soon as this month,” wrote Pesole.
One obstacle for stock markets to keep pushing higher could be uncertainty about trade deals. Trump has said he isn’t looking to extend the July 9 deadline for the reimposition of tariffs, as negotiations with Japan appeared to hit a block over rice imports and car tariffs. However, he signaled a deal with India could be progressing in conversation with reporters on Tuesday.