US futures lower as tariff ruling sparks caution, Asia ends mixed

Wall Street futures were lower as investors tracked tariff-related developments and a seasonally weak month for equities.

US index futures edged lower on September 2, retreating on the back on a four-month winning streak on Wall Street, with traders weighing fresh tariff-related uncertainty and seasonal headwind for equities during September.

Dow Jones Industrial Average futures fell 0.6%, S&P 500 futures was down 0.8% and Nasdaq 100 futures fell 1% a short while ago. During August, S&P 500 managed to rise nearly 2%.

Mega-cap stocks, which have driven much of the rally, were leading the premarket losses, with Nvidia down 1.5% and Palantir lower by 2%.

Bond yields nudged higher, with the 10-year US Treasury yield rising up to 4.29% and the 30-year nearing 4.98%.

The cautious tone followed a US federal appeals court ruling that most of President Trump’s global tariffs were illegal. The 7-4 decision held that only the Congress has the authority to impose such levies. Trump has vowed to appeal to the Supreme Court, calling the ruling 'highly partisan'.

“A Supreme Court ruling against the use of IEEPA on reciprocal tariffs would reduce the risk of broad-based tariff escalation, which is market-positive,” said Aniket Shah, head of sustainability and transition strategy at Jefferies. “However, short-term uncertainty may rise as some trade agreements may need to be renegotiated.”

Traders will also be watchful of the Federal Reserve’s policy path and political pressures. A hearing on whether Trump can temporarily be barred from firing Fed Governor Lisa Cook concluded last week without a ruling. Separately, Stephen Miran, Trump’s nominee to the central bank’s board, faces his Senate Banking Committee hearing on September 4.

Seasonality too has added to investor caution, with September historically being the weakest month for equities, taking the S&P 500 down 4.2% on average over last five years, and over 2% on average over the last decade.

On the corporate front, Signet Jewelers rose more than 5% in premarket trade after reporting quarterly earnings and revenue that beat estimates and raising its full-year guidance. Kraft Heinz confirmed it will split into two publicly traded companies in a tax-free spinoff, with one focusing on global brands such as Heinz and Kraft Mac & Cheese and the other on North American grocery staples including Oscar Mayer.

The week, Friday’s August jobs report will be a key macroeconomic indicator that could shape expectations ahead of the Fed’s mid-September policy meeting.

Asia Mixed

Earlier in the day, Asia-Pacific markets ended mixed as investors digested the implications of a US court ruling on tariffs and followed developments at the Shanghai Cooperation Organization summit in Tianjin, China.

India’s benchmark indices ended modestly higher with the Nifty 50 up 0.29% and the BSE Sensex higher by 0.26%. Japan’s Nikkei 225 gained 0.29% to close at 42,310.49, while the Topix index added 0.61%. South Korea’s Kospi rose 0.94% and the Kosdaq climbed 1.15%.

Hong Kong’s Hang Seng index slipped 0.47%, and mainland China’s CSI 300 fell 0.74%. Australia’s S&P/ASX 200 closed 0.3% lower, weighed down by regulatory headlines.

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