Stock futures were on the rise this past Sunday, as investors sought to determine if equities could sustain their recent gains into a new trading week. Futures linked to the Dow Jones Industrial Average increased by 182 points, reflecting a 0.4% gain. Similarly, S&P 500 futures saw an uptick of 0.5%, while Nasdaq 100 futures climbed by 0.6%. This upward movement follows a much-needed winning week for stocks, with the S&P 500 closing in the green on Friday and breaking a streak of four consecutive weekly losses.
Despite the positive week, investor sentiment remains somewhat jittery due to worries about a potential slowdown in U.S. economic growth. These concerns are particularly pressing as President Donald Trump’s April 2 deadline for implementing reciprocal tariffs approaches. Trump has indicated that these tariffs will target any country that imposes duties on U.S. imports, raising alarms in the investment community.
However, Bank of America's trading desk expressed optimism in a note released on Sunday, suggesting that equities appear poised for a bounce. They noted that key positioning hurdles have been cleared, investor sentiment has reset, market flows are becoming more favorable, and growth concerns are well acknowledged.
On Friday, President Trump seemed to ease some investor fears when he mentioned to reporters that there might be flexibility regarding his reciprocal tariff plan. Although he did not provide specific indications of potential tariff exemptions, similar to his previous comments regarding automakers in March, his remarks were seen as a slight relief.
Additionally, a report from the Wall Street Journal on Sunday indicated that the upcoming tariffs may have a narrower scope, likely excluding certain industry-specific duties, according to an administration official. Despite this, the anticipation of pending duties and Trump's overall trade rhetoric has heightened fears among investors about the stability of the U.S. economy.
These economic anxieties were further compounded by recent data showing weakening consumer sentiment. Nonetheless, investors received a boost from Federal Reserve Chair Jerome Powell, who stated last week that any negative repercussions from Trump's tariffs are expected to be short-lived. This reassuring message may help stabilize market sentiment as investors look for signs of resilience in the economy.
Looking ahead, investors have a busy week of data to digest. A key consumer confidence report is set to be released on Tuesday, followed by initial weekly jobless claims figures on Thursday, both of which will provide further insights into the health of the U.S. economy.
