U.S. stock futures jumped higher early Wednesday as the market looked set to continue its rebound after President Donald Trump eased fears on two fronts–the U.S.-China trade war and the threat to Federal Reserve independence.
Futures on the S&P 500 were up 2%, Dow Jones Industrial Average futures rose 1.5%, or 597 points, and Nasdaq 100 futures were up 2.4% ahead of the open Wednesday. All three major indexes climbed more than 2.5% Tuesday after falling by similar amounts Monday.
In a double boost for stocks, Trump said he has no intention of firing Fed Chair Jerome Powell and suggested 145% tariffs on imported goods from China will come down “substantially” once the two countries negotiate a deal.
Separately, Treasury Secretary Scott Bessent said he expects the U.S. and China to start de-escalating hostilities in the “very near future” in comments made at an event in Washington, D.C., a person in the room told Barron’s_.
“Hopes for a reprieve in the trade war are leading to a small swell of investor confidence,” Hargreaves Lansdown analyst Susannah Streeter said. “While there’s been no concrete decisions to hang the hat of optimism on, Trump has indicated that he is in a mood for negotiation,” she added.
Trump’s comments helped U.S. bonds and the dollar, which struggled at the start of the week. The U.S. Dollar Index rose 0.2% to 99.08 early Wednesday after hitting a three-year low Monday, while the yield on the 10-year Treasury note fell to 4.358% from 4.4% Tuesday.
Earnings will be in focus Wednesday as investors look for signs of any impact from Trump’s tariffs regime and the subsequent macroeconomic uncertainty. Tesla’s earnings late Tuesday missed expectations but the stock climbed as CEO Elon Musk said he would spend less time in Washington working with the Department of Government Efficiency, or DOGE.
Musk also said tariffs “are tough” on Tesla but that the electric-vehicle maker is the least affected among major auto makers.
AT&T, Boeing, and Philip Morris International are among the companies set to report before the market opens, while Chipotle Mexican Grill and Alaska Air release earnings after the bell.
