New York, N.Y. — U.S. stock futures remained steady Monday evening as investors braced for the commencement of the Federal Reserve’s pivotal policy meeting. This gathering marks the first since President Donald Trump introduced “reciprocal” tariffs earlier this month, increasing market tension. S&P 500 futures showed little movement, while Dow Jones Industrial Average futures crept up slightly. However, Nasdaq-100 futures dipped by 0.2%.
During the trading day, the S&P 500 unexpectedly declined by 0.6%, breaking its longest winning streak since 2004. The Nasdaq Composite saw a 0.7% drop, and the Dow recorded a slight decrease of 0.2%. The uncertainty surrounding tariffs continues to affect investor sentiment, keeping traders on edge.
Treasury Secretary Scott Bessent expressed optimism during a CNBC interview on Monday, stating that the U.S. is “very close to some deals.” His comments echoed those of President Trump, who suggested that trade agreements could materialize as early as this week. Additionally, a Bloomberg report indicated that India has proposed abolishing tariffs on select goods. However, no formal agreements between the U.S. and its trading partners have yet been confirmed.
While April data from the Institute for Supply Management indicated that service sector activity was stronger than expected, concerns regarding tariffs persisted. Investors are particularly focused on the Fed’s two-day policy meeting, which begins Tuesday, with an announcement regarding interest rates scheduled for Wednesday afternoon. Current trading in fed funds futures reflects only a 2.7% probability of a rate cut at this time, leaving traders eager for insights from Fed Chair Jerome Powell regarding the central bank’s economic outlook.
Megan Horneman, chief investment officer at Verdence Capital Advisors, noted that supply chain disruptions and potential slowdowns in growth could result from ongoing tariff negotiations. “It’s possible these developments could momentarily impact inflation, causing the Federal Reserve to navigate a tricky landscape concerning interest rates,” Horneman said. However, she believes any disruptions will not be prolonged. “Countries are too interconnected to avoid reaching some agreements sooner rather than later,” she added.
Looking ahead, investors will be monitoring the release of the U.S. trade deficit data for March, slated for Tuesday morning. They will also be awaiting earnings reports from major companies, including DoorDash, set to release figures in the morning, followed by Advanced Micro Devices and Super Micro Computer later in the day. This mix of economic indicators and corporate performance is expected to further shape market dynamics in the coming days.