S&P 500 futures remained relatively unchanged on Tuesday evening following the announcement by President Donald Trump regarding a significant trade deal with Japan. Futures associated with the broad market index saw a modest increase of 0.10%, while Dow Jones Industrial Average futures climbed 70 points, representing a 0.16% rise. In contrast, Nasdaq 100 futures hovered close to the flatline, indicating a mixed sentiment in the tech sector.
Following Trump's announcement on his Truth Social platform that the U.S. had finalized a "massive deal" with Japan, stock futures briefly gained momentum. The newly established agreement entails reciprocal tariffs of 15% on Japanese exports to the U.S. This development comes on the heels of a two-day rally that saw the S&P 500 finish the day at a record high, edging up by 0.06%. Notably, this marks the 11th closing record for the benchmark index in 2025.
During the same trading session, the 30-stock Dow surged nearly 180 points, reflecting optimism in traditional industrial sectors. On the other hand, the tech-heavy Nasdaq Composite experienced a decline of approximately 0.4%, primarily due to a downturn in chip stocks. Ryan Detrick, chief market strategist at Carson Group, expressed a tempered outlook on CNBC's Closing Bell, stating that while there isn't strong optimism, the anticipated summer rally, which was initially met with skepticism, is indeed occurring and may continue.
Investors are eagerly awaiting earnings reports from two major players in the tech industry, Alphabet and Tesla, which are set to be released on Wednesday after market close. These reports represent the first insights of the earnings season for the megacap technology sector, a group that has been pivotal in driving market performance in recent years. In addition to these tech giants, market participants will also keep an eye on earnings from Hasbro prior to the opening bell, followed by reports from Chipotle Mexican Grill and Mattel after the market closes.
This busy earnings week comes at a time when approximately 17% of S&P 500 companies have reported their earnings, with an impressive 85% of these companies surpassing Wall Street's expectations. Investors are looking for signs of continued strength in corporate earnings as they navigate through this critical financial period.
On the economic front, traders will be paying close attention to the existing home sales data scheduled for release on Wednesday morning. This data is crucial as it provides insights into the health of the housing market, which is a significant component of the overall economy.
As the market continues to react to both corporate earnings and economic indicators, investors remain cautiously optimistic about the potential for sustained growth in the coming months.
