Stock futures rose on Wednesday, boosted by the latest updates on U.S.-China trade talks and the anticipated Fed decision, as investors kept a close watch on potential market impacts.
Markets React to U.S.-China Trade Talks and Fed Decision
The Dow Jones Industrial Average futures rose by 226 points (0.6%), while S&P 500 and Nasdaq 100 futures also climbed by approximately 0.6% each. The boost followed confirmation that U.S. Treasury Secretary Scott Bessent and trade official Jamieson Greer are scheduled to meet with Chinese delegates this week in Switzerland.
This meeting offers a potential breakthrough after last month’s tariff announcement by President Trump rattled investor confidence and heightened market volatility.
Fed Decision and U.S.-China Trade Talks Drive Market Focus
The market is now looking ahead to the Federal Reserve’s interest rate decision, due at 2 p.m. ET. According to the CME FedWatch tool, there’s a 97% probability that the central bank will hold rates steady.
Traders are expected to closely analyse Fed Chair Jerome Powell’s press conference following the decision for clues about the Fed’s future policy stance. Powell remains under scrutiny following recent political pressure, including public remarks from Trump questioning his leadership.
Some analysts caution against expecting a significantly dovish stance from the Fed, despite the current market and political uncertainties.
“Those betting on a dramatically dovish tone from the Fed in response to recent political and market uncertainty might be disappointed,” said Thierry Wizman, global FX and rates strategist at Macquarie.
Volatility Remains Amid U.S.-China Trade Talks and Fed Decision
Wednesday’s cautious optimism followed a negative session on Tuesday, when the Dow dropped nearly 390 points (1%), while the S&P 500 and Nasdaq Composite fell by 0.8% and 0.9%, respectively.
TCW CEO: Expect More Market Uncertainty
Katie Koch, CEO of TCW, predicted continued market turbulence in the coming weeks. Speaking at the Milken Institute Global Conference, Koch highlighted ongoing economic uncertainty and mixed data points.
“We’re likely to see continued volatility,” she said. “This is a process, and it’s going to take time. We’ve got a lot of dry powder and are ready to deploy when the right opportunity arises.”
Koch also sees long-term growth potential in sectors supporting the artificial intelligence boom and energy infrastructure, calling these areas key to future wealth creation.
After-Hours Stock Movers
- Super Micro Computer shares dropped around 5% after underperforming expectations. The company posted earnings of $0.31 per share on $4.60 billion in revenue, well below analyst forecasts.
- Advanced Micro Devices (AMD) jumped nearly 4% after beating estimates with Q1 earnings of $0.96 per share and $7.44 billion in revenue.
- Wynn Resorts slipped 2% following weaker-than-expected Q1 earnings of $1.07 per share on $1.70 billion in revenue.
Futures Pull Back After-Hours
Despite earlier gains, futures turned slightly negative after 6 p.m. ET. Dow and S&P 500 futures dipped by 0.2%, while Nasdaq 100 futures slipped 0.3%.
Final Thoughts
Markets are in a holding pattern, driven by anticipation around U.S.-China trade talks and the Fed’s interest rate guidance. Volatility remains a central theme, but investors appear cautiously optimistic about potential progress on both policy and trade fronts.