Futures markets showed positive momentum on Tuesday, with S&P 500 and Nasdaq futures climbing following the Senate’s confirmation of Stephen Miran as a Federal Reserve board governor. This decision comes on the heels of a record-setting day for Wall Street.
Futures linked to the Dow Jones Industrial Average remained relatively flat, while the S&P 500 saw a modest increase of 0.2%. The tech-heavy Nasdaq 100 experienced a slightly higher boost of 0.3%. The Senate’s narrow approval, achieved with a 48-47 vote on Monday evening, places Miran in a critical position ahead of the Federal Reserve’s policy meeting set to begin on Tuesday, where he will have the opportunity to influence forthcoming interest rate decisions.
Although Miran has expressed intentions to act independently, his plans to take a leave of absence—without resigning—from his role as a White House advisor have raised eyebrows concerning the autonomy of the Federal Reserve, especially given President Trump’s interest in potentially firing Fed governor Lisa Cook.
The previous day’s trading session witnessed stocks rallying, pushing both the S&P 500 and Nasdaq Composite to new record highs. This surge was supported by ongoing US-China trade discussions taking place in Madrid and prevailing expectations that the Fed will announce a rate cut at their upcoming meeting.
This week appears light on significant economic data; however, Tuesday is set to deliver the latest retail sales figures, which are crucial for understanding consumer behavior amidst persistent inflation and a shaky labor market.
In premarket trading on Tuesday, Tesla’s stock saw a 2% increase. This rise followed a rebound in its year-to-date performance after CEO Elon Musk made headlines by purchasing shares of the electric vehicle manufacturer for the first time since 2020.
The pivotal moment of the week will arrive on Wednesday when the Federal Reserve is expected to announce its decision on interest rates. Market sentiment strongly favors a reduction, with traders assigning a 96% probability to a 25 basis-point cut, as economic conditions reveal a slowdown in the labor market alongside ongoing inflation challenges.
Looking ahead, President Trump and Chinese President Xi Jinping are scheduled to discuss trade matters and potentially negotiate a new framework for a TikTok agreement later in the week.
In the bond market, US Treasuries have gained a leading position in global markets driven by rising expectations for Federal Reserve easing, which has reversed previous bearish sentiments. Meanwhile, gold prices have surged to new records as the Fed’s decision approaches, reflecting heightened market activity.
