U.S. equity futures edged higher Tuesday as investors digested renewed U.S.-China trade negotiations, a packed corporate earnings calendar, and a key Federal Reserve decision that could shape the economic outlook for the rest of the year. Meanwhile, Nvidia is reportedly ramping up production of its AI chips to meet rising demand from Chinese markets.
Wall Street Futures Slightly Higher
Ahead of the opening bell, futures tied to major U.S. indexes showed modest gains. As of 03:35 ET, Dow futures were up 27 points (0.1%), S&P 500 futures climbed 8 points (0.1%), and Nasdaq 100 futures advanced 62 points (0.3%).
The S&P 500 reached a new record high on Monday, while the Nasdaq also moved upward. Those gains came on the heels of a weekend U.S.-EU trade pact — one of several deals the White House is trying to complete before broader “reciprocal” tariffs are scheduled to kick in on August 1.
Analysts at Vital Knowledge said the 15% blanket tariff on EU imports had already been priced in, noting that “that’s exactly what [markets] got.”
Beijing and Washington Meet Again
Fresh trade talks between the U.S. and China kicked off in Sweden, raising hopes that the two economic superpowers could extend their temporary tariff pause. The deadline to reach a more lasting agreement is August 12.
U.S. Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng were spotted at the Swedish Prime Minister’s office, where discussions were being held. According to Reuters, no statements were given Monday night, and officials did not address reporters.
Although expectations for a sweeping resolution are muted, U.S. Trade Representative Jamieson Greer remarked that an “enormous breakthrough” was not expected. Nonetheless, some reports suggest a 90-day extension of the current truce could be on the table, possibly paving the way for another summit between President Trump and President Xi Jinping.
Corporate Earnings Shift Into High Gear
The earnings season accelerates this week, with 164 companies in the S&P 500 expected to publish quarterly results.
Before U.S. markets open Tuesday, investors will hear from a range of major firms including Merck, UnitedHealth, Boeing, and Procter & Gamble — the latter still in the spotlight after Monday’s news that CEO Jon Moeller will step down.
Visa headlines the list of post-market reports. The payments giant, along with MasterCard, is expected to provide fresh insight into consumer spending trends amid trade-related uncertainty.
Earnings momentum also extended to Europe. AstraZeneca reported strong quarterly earnings, buoyed by demand for cancer drugs. Barclays surpassed expectations due to increased trading activity following April’s U.S. tariff announcements. Philips raised its margin forecast, noting a smaller-than-anticipated impact from trade levies. Stellantis, however, dipped slightly after its new CEO warned of “challenges” ahead, even as the automaker predicted stronger revenue in the second half of the year.
Economic Indicators Pile Up
Markets are preparing for a wave of economic data this week, much of it closely tied to labor market health and inflation expectations.
The Job Openings and Labor Turnover Survey (JOLTS) — a key measure of employment demand — is due Tuesday, with forecasts pointing to a decline to 7.51 million from 7.77 million. Other closely watched metrics this week include private payroll data and Friday’s July jobs report.
The Conference Board is also set to release its consumer confidence index for July, which economists expect will improve slightly from June’s level.
ING analysts wrote, “Ahead of tomorrow’s FOMC meeting, which could also prove dollar positive, today sees the release of US JOLTS job opening data and also July consumer confidence. The former is expected to show some stability (at around the 7500k mark) and the latter is expected to pick up in line with the strong stock market.”
The Federal Reserve begins its two-day meeting Tuesday, with widespread expectations that interest rates will remain steady. Fed officials have recently hinted they may prefer to hold off on further changes until the effects of ongoing trade policies are clearer.
Nvidia Accelerates AI Chip Production for China
Nvidia has reportedly ordered 300,000 H20 artificial intelligence chips from Taiwan Semiconductor Manufacturing Co (TSMC), according to Reuters. The move follows the Biden administration’s decision earlier this month to lift restrictions on selling the H20 to Chinese customers.
With the new order, Nvidia’s H20 chip inventory — which previously stood between 600,000 and 700,000 units — is set to expand. The company is believed to have sold around 1 million of these chips in 2024, based on figures from SemiAnalysis.
While the H20 lacks the capabilities of Nvidia’s top-tier H100 or Blackwell models, it remains strategically important for the Chinese market. CEO Jensen Huang, speaking in Beijing earlier this month, stated that restarting production could take up to nine months.
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