U.S. stock index futures moved slightly downward early Tuesday following a strong recent performance, as traders turn their attention to upcoming retail sector earnings.
As of 5:50 a.m. ET, futures tied to the Dow Jones Industrial Average were down 90 points, or 0.2%. Futures for the S&P 500 dropped 21 points, or 0.4%, while Nasdaq 100 futures slipped by 100 points, or 0.5%.
On Monday, Wall Street closed with moderate gains, rebounding from early losses triggered by Moody’s recent downgrade of the U.S. credit outlook. The S&P 500 marked its sixth consecutive day in positive territory, moving within 3% of its all-time high.
Focus Turns to Home Depot Earnings
Investors are now shifting their attention to the retail sector, with Home Depot (NYSE:HD) scheduled to release its quarterly earnings before markets open. Analysts and traders alike will be scrutinizing the company’s pricing and margin strategies, particularly after Walmart (NYSE:WMT) indicated it might raise prices in response to tariff pressures stemming from former President Trump’s trade policy proposals.
Trump subsequently pushed back, stating Walmart should absorb the additional costs rather than pass them on to consumers.
With fellow home improvement retailer Lowe’s (NYSE:LOW) also in focus, the market will be watching closely to see whether tariffs are starting to impact consumer behavior and spending on renovation projects. Economists have flagged that weakening consumer sentiment, possibly due to tariff-related inflation risks, could weigh on economic growth.
Homebuilder Toll Brothers (NYSE:TOL) is also set to report its earnings after the market closes.
Tax Reform Bill Advances
Meanwhile, tax reform is back in the headlines after a House committee approved a comprehensive tax cut proposal on Sunday. The bill, which is supported by Trump, includes major income tax reductions and increased funding for defense and immigration efforts.
However, the proposal faces criticism for potentially widening the federal deficit, which is already at historic levels. Several moderate and fiscally conservative Republicans have expressed concerns over its long-term impact on government revenues.
Trade Policy Developments
Market participants continue to monitor global trade dynamics. After a preliminary trade understanding between the U.S. and China last week, attention now shifts to upcoming discussions between American and Japanese trade representatives, as reported by Japan’s Kyodo News.
That said, no major breakthroughs are expected at this week’s G7 finance meeting in Canada, according to Reuters.
Tensions also remain with China, as Beijing responded strongly to a recent U.S. Commerce Department advisory cautioning against the use of Huawei’s Ascend chips. China’s Ministry of Commerce accused the U.S. of undermining trade progress made during high-level talks in Geneva and demanded corrective action.
Oil Prices Dip on Geopolitical Concerns
Crude oil prices saw a slight decline in early Tuesday trading amid mixed geopolitical signals. At 5:50 a.m. ET, Brent crude had edged down 0.1% to $65.49 per barrel, while U.S. West Texas Intermediate (WTI) also slipped 0.1% to $62.11 per barrel.
Iran’s declaration that its uranium enrichment efforts are “non-negotiable” has further complicated the path to a nuclear agreement with the U.S. A potential deal could eventually ease sanctions, opening the door to increased Iranian oil exports and reshaping global supply dynamics.
Additionally, investors are watching for updates on the Russia-Ukraine conflict, as any movement toward a ceasefire could shift energy market sentiment and influence broader geopolitical risk assessments.