The U.S. stock index futures slipped on Tuesday as investors weighed concerns over the ongoing trade war between the United States and China. The potential escalation in tensions could have adverse effects on global economic growth. Investors are also awaiting the release of the U.S. Job Openings and Labor Turnover Survey (JOLTs) report.
This report will provide insights into the health of the labor market and could influence market sentiment. The JOLTs report is a closely watched indicator that details job openings, hires, and separations. Another focal point for the markets today is the earnings report from Alphabet Inc.
(GOOGL). The tech giant’s performance is often seen as a barometer for the broader technology sector. Analysts are keen to see how the company’s advertising revenue and cloud services have fared amid the challenging economic landscape.
In the commodity markets, crude oil futures were mixed, reflecting the broader uncertainty affecting global markets. Traders will also be monitoring movements in other key commodities like soybeans, natural gas, and copper. These commodities could be impacted by trade policy developments and global demand conditions.
Market participants will be closely following these critical reports and earnings announcements. These developments are expected to drive trading patterns throughout the session.
Trade tensions impact market sentiment
China reacted swiftly on Tuesday to President Donald Trump’s additional 10% levies on Chinese imports. Beijing slapped tariffs of 15% on U.S. coal and liquified natural gas, starting Feb. 10.
They also imposed 10% duties on imports of crude oil, farm equipment, and some autos. This move raised the risk of an escalation into a trade war that could damage both of the world’s top two economies. However, some on Wall Street see the Chinese response as showing restraint that opens the door to compromise.
President Trump also brought forward talks with China’s President Xi, saying they would take place “probably over the next 24 hours.”
China announced on Tuesday that it has launched an anti-monopoly investigation into Alphabet’s Google. They also placed two U.S. companies, PVH Corp and biotech company Illumina, on its “unreliable entities list.”
A big week of earnings reports is underway, with reports from Spotify, PayPal, and Chipotle also highlights on Tuesday’s docket. Palantir brought some upbeat news to Wall Street after the bell on Monday.
The intelligence software company’s first quarter and annual revenue forecasts both exceeded expectations. On the data front, a reading on job openings in December is due later, laying the groundwork for Friday’s crucial monthly jobs report. Additional economic data expected includes factory orders and durable and capital goods orders for December.
As markets remain unsettled about the future, gold’s appeal as a safe haven has been boosted. Spot gold rose to $1,580 an ounce before dropping back slightly as the dollar retreated from its highest level in more than two years.
