Stock futures edged lower on Sunday, reflecting market unease as investors brace for a week filled with significant economic data releases and potential new tariffs. Futures tied to the Dow Jones Industrial Average declined by 62 points, or 0.14%, while S&P 500 futures slipped 0.16%, and Nasdaq 100 futures ticked down 0.24%. The market's cautious sentiment is driven by President Donald Trump's anticipated announcement of a blanket 25% tariff on all steel and aluminum imports, set to be unveiled on Monday.
President Trump did not specify the exact timing of these tariffs, but their announcement comes amidst heightened economic uncertainty. The tariffs are expected to include retaliatory measures against countries taxing U.S. imports, adding to market jitters. Trump's previously announced duties on China are also poised to take effect at midnight on Sunday, further intensifying trade tensions.
Adding to the week's economic agenda, Federal Reserve Chair Jerome Powell will address Congress on Monday morning, likely influencing investor sentiment. Furthermore, the January consumer price index report is scheduled for release on Wednesday at 8:30 a.m. ET, followed by initial weekly jobless claims and the producer price index on Thursday. These reports are critical as they offer insights into inflationary pressures and economic health.
The market's apprehension is compounded by concerns over how these tariffs might impact business operations and hiring decisions. Lydia Boussour, a senior economist at EY-Parthenon, noted:
"Steep tariffs and heightened policy uncertainty could push businesses to increasingly adopt wait-and-see behaviors and pull back on hiring."
Investors are also closely monitoring major corporate earnings reports, with McDonald's set to report on Monday, followed by Coca-Cola on Tuesday. These earnings will provide further clarity on the impact of economic conditions and trade policies on corporate performance.