Wall Street futures slip as investors eye Fed meet amid tariff jitters

Markets remain on edge over global trade dynamics. While U.S. Treasury Secretary Scott Bessent said Monday that Washington is "very close to some deals," echoing optimism shared by President Trump over the weekend

US stock futures edged lower on Tuesday as investor sentiment turned cautious ahead of the Federal Reserve’s closely watched policy meeting — the first since President Donald Trump floated the idea of imposing "reciprocal" tariffs earlier in April.

Futures tracking the S&P 500 slipped 0.6 percent, while those linked to the Dow Jones Industrial Average dropped 212 points, or 0.5 percent. Contracts on the Nasdaq-100 fell 0.9 percent, under pressure from weakness in tech.

The downbeat mood followed Monday’s retreat on Wall Street, where the S&P 500 snapped a rare nine-day winning streak — its longest since 2004 — with a 0.6 percent drop. The Nasdaq Composite fell 0.7 percent, and the Dow shed 0.2 percent, as trade nerves resurfaced.

Markets remain on edge over global trade dynamics. While U.S. Treasury Secretary Scott Bessent said Monday that Washington is "very close to some deals," echoing optimism shared by President Trump over the weekend, no concrete announcements have emerged yet. A Bloomberg report suggested India has floated a proposal for zero tariffs on select goods, but formal agreements remain elusive.

On the economic front, data from the Institute for Supply Management showed the U.S. services sector performed better than expected in April, offering a glimmer of resilience. Still, investors remained preoccupied with trade tensions and their potential to derail momentum.

The Federal Reserve’s two-day policy meeting begins Tuesday, with a statement due Wednesday afternoon. While the market isn’t pricing in a rate cut — odds are just 2.7 percent, according to fed funds futures — the spotlight will be on Chair Jerome Powell’s comments for any hint on how the central bank views the evolving landscape.

Asia-Pacific markets traded on a mixed note Tuesday as investors weighed fresh signals on trade negotiations between the U.S. and regional economies, while a strengthening dollar put pressure on Asian currencies, reversing earlier gains.

In China, equities resumed trading after the Labour Day break on a positive footing, buoyed by signs that Washington and Beijing may be softening their stance to de-escalate trade tensions. The CSI 300 index rose 1.01 percent to close at 3,808.54 — its highest level in over a month.

Hong Kong’s Hang Seng Index also edged higher, gaining 0.7 percent to finish at 22,662.71, as markets welcomed the more conciliatory tone in U.S.-China trade rhetoric.