US futures markets showed some weakness today after the S&P 500 hit a record high for the second consecutive day. Futures for the S&P 500 (ES=F), Nasdaq (NQ=F), and Dow Jones (YM=F) all drifted down by 0.1%.
This market action comes after the Federal Reserve released minutes from its January meeting, where policymakers expressed support for pausing interest rate cuts. They cited factors such as President Donald Trump’s tariffs and mass deportations of migrants potentially raising inflationary pressures. These concerns are leading investors to believe that rate cuts may not materialize anytime soon.
In related news, General Motors (GM) hinted that it might consider moving its plant locations due to upcoming auto tariffs. Meanwhile, Defense Secretary Pete Hegseth announced an 8% cut in military spending over the next five years, which initially impacted Palantir Technologies (PLTR). The stock dropped 10% after the announcement and continued to decline by 3% in after-hours trading.
As earnings season continues, Walmart (WMT) is expected to report results that exceed Wall Street’s high expectations for the retail giant.
Additionally, Morgan Stanley made a notable shift in its outlook on Chinese stocks, turning more optimistic after a wave of positive sentiment driven by advancements in artificial intelligence in China. The firm is now recommending an equal-weight position in Chinese equities and predicts that the MSCI China Index could rise by 22%, reaching 77 by the end of 2025. This pivot is a major turnaround from their previous bearish stance.
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