US Stock Futures Rebound After Trump-Powell Tensions Sparked Market Selloff

TLDR

President Trump’s criticism of Federal Reserve Chair Powell sparked a major stock market selloff on Monday US stock futures rebounded Tuesday with S&P 500, Dow, and Nasdaq futures all rising around 0.8% The Dow is down 9% in April, potentially its worst April since 1932 Five Fed officials are scheduled to speak Tuesday as concerns about Fed independence grow Tesla reports earnings after Tuesday’s close amid declining sales and stock performance

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US stock futures pointed higher on Tuesday morning as markets attempted to recover from Monday’s steep selloff triggered by President Donald Trump’s escalating criticism of Federal Reserve Chair Jerome Powell. The previous day’s market action saw the Dow Jones Industrial Average tumble 972 points or 2.5%, while the S&P 500 fell 2.4% and the Nasdaq Composite dropped 2.6%.

E-Mini S&P 500 Jun 25 (ES=F)

Futures contracts for all three major indices showed signs of a rebound in early Tuesday trading. S&P 500 futures rose 0.8%, Dow futures climbed 0.7%, and Nasdaq 100 futures increased 0.8% ahead of the market open.

The selloff came after President Trump called Powell “a major loser” and criticized the Federal Reserve for maintaining steady interest rates. Trump also referred to Powell as “Mr. Too Late” and suggested the economy would slow unless Powell cuts rates immediately.

These comments follow Trump’s statement last week that Powell’s “termination cannot come fast enough,” raising investor concerns about potential threats to the Fed’s independence. Deutsche Bank strategist Jim Reid noted that “yesterday’s market moves were the clearest sign yet of investor anxiety over the topic.”

Market Performance and Bond Yields

The Dow’s performance has been poor this month, dropping 9% in April so far. According to Dow Jones Market Data, this puts the index on track for its worst April since 1932, during the Great Depression era.

The US Dollar Index, which measures the greenback against a basket of currencies, fell to a three-year low on Monday but edged higher to 98.33 in early Tuesday trading. Meanwhile, bond markets continued to show stress signs.

Long-term bonds struggled as the yield on the 10-year Treasury note climbed to 4.42% early Tuesday. The 30-year Treasury yield reached a three-month high on Monday and continued rising Tuesday, indicating persistent concerns in the fixed-income market.

In foreign exchange markets, the Japanese yen hit a seven-month high against the dollar, appearing to serve as a safe-haven alternative for investors seeking stability amid the market turbulence.

Fed Officials to Speak as Uncertainty Grows

The threat to Federal Reserve independence may remain a key theme on Tuesday with five central bank officials scheduled to speak. These include Vice Chair Philip Jefferson, Philadelphia Fed President Patrick Harker, Minneapolis Fed President Neel Kashkari, Richmond Fed President Tom Barkin, and Governor Adriana Kugler.

Their comments will be closely watched for any signals regarding the Fed’s reaction to Trump’s criticism and their outlook on interest rate policy. The public statements could either calm market fears or potentially fuel further volatility depending on their tone and content.

Market analysts suggest the Fed may now be less likely to cut rates following Trump’s attacks, as doing so could appear to be giving in to political pressure rather than making decisions based on economic data.

European and Asian markets were falling Tuesday as they caught up with Wall Street’s action from Monday, showing the global impact of the US market turbulence.

Investors will be watching corporate earnings closely this week for indications of how Trump’s tariff policies are affecting businesses and trade. Tesla will report results after Tuesday’s close, while 3M, Lockheed Martin, and Verizon Communications are among those releasing earnings before the market opens.

Tesla has faced challenges recently, with its shares down nearly 44% this year amid signs of slumping sales and waning demand. The company’s CEO Elon Musk’s role in the White House has also reportedly affected the brand’s perception among some consumers.

In other corporate news, Verizon shares dropped 3% in premarket trading after the telecom giant reported larger-than-expected losses in wireless subscribers for the first quarter, impacted by recent price increases and strong competition from rivals.

On the international front, the US hailed progress on a trade deal with India as Vice President JD Vance met with Prime Minister Narendra Modi, offering a potential bright spot amid broader trade tensions.

Gold prices continued their upward trajectory, hitting a record above $3,500, with analysts suggesting the precious metal could climb even higher as investors seek safe havens from market volatility.

Bitcoin’s price rose as well, with some market participants making the case for the cryptocurrency as “digital gold” amid the traditional market uncertainty. This narrative has gained traction during periods of financial market stress.

European markets fell but avoided the heavy losses seen in the US, with analysts suggesting the current market turbulence is primarily a US-centric issue related to domestic politics and monetary policy concerns.

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