U.S. equity futures edged higher in early Monday trading amid a big retreat for the dollar and a nudge higher in Treasury bond yields, as investors looked to a busy week of tariff headlines and economic data that could add further downside pressure to the market’s recent slump.
Stocks rallied hard late Friday, despite concerns tied to the angry set of exchanges between President Donald Trump and Ukraine President Volodymyr Zelenskyiy in the White House and its impact on U.S. policy in Europe and elsewhere, but couldn’t lift the three major benchmarks into positive territory for the week.
The S&P 500, in fact, closed out February with a 1.45% decline, trimming its year-to-date gain to around 1.4%, as investors remain worried that the dizzying array of Trump policies on tariffs, immigration, government spending and foreign policy will weigh on economic growth over the first half of the year and beyond.
The Atlanta Fed’s GDPNow forecasting tool offered an early glimpse into that effect, with the real-time tracker showing the U.S. economy on pace to contract by 1.5% over the first quarter, a big decline from its prior estimate of a 2.3% advance.
“Last week ended poorly,” said Boris Kovacevic, global macro strategist at Convera. “Trump and Zelenskiy clashed in the Oval Office over Ukraine, leading to a canceled press conference and signaling that an immediate peace deal is unlikely.”
“Geopolitical tensions and tariff discussions have negatively impacted risk assets and investors question the health of the US economy,” he added.
Fed Chairman Jerome Powell will delivery a keynote address to a monetary policy forum in New York Friday, just hours after the Labor Department’s February jobs report.
A series of job market data releases will test that assessment this week, and perhaps indicate the impact of Trump’s DOGE-lead overhaul of the federal workforce, culminating with the Labor Department’s February employment report prior to the start of trading on Friday.
Markets will also focus on whether the President will impose tariffs on goods from Canada and Mexico, as well as additional duties on imports from China, starting Tuesday, following a 30-day delay he said would allow for negotiations with each of the three key U.S. trading partners.
With the fourth quarter earnings season drawing to a close, only 11 S&P 500 companies are expected to report December-quarter earnings this week, with updates from Target (TGT) , Costco (COST) , Marvell (MRVL) and Broadcom (AVGO) likely to dominate the market’s attention.
Related: Nvidia’s post-earnings slide highlights key risk
Heading into the start of the trading day on Wall Street, futures contracts tied to the S&P 500 suggest a modest 18 point opening bell gain, with the Dow Jones Industrial Average called 80 points higher.
The tech-focused Nasdaq, which fell 4% over the month of February, is called
Benchmark 2-year Treasury bond yields edged 3 basis points from Friday’s levels to 4.301% while 10-year notes were up 3 basis points to 4.255%.
The U.S. dollar index, meanwhile, was marked 0.55% lower against a basket of its global peers to trade at 107.019.
Bitcoin prices were also active, rising around 8% from Sunday levels following a post from President Trump suggesting he would establish a national reserve of digital currencies, virtually all of which are already backed by U.S. dollars, sometime in the future.
More Wall Street Analysts:
Analyst revisits Palantir stock forecast after annual report filingVeteran analyst sounds the alarm on Google and Mag 7Veteran stock analyst delivers blunt 3-word message on tariffs
In Europe, a weekend summit of regional leaders in London in support of Ukraine security boosted regional defense stocks, as well as the single currency, as Britain pledged another $1.5 billion in defense finance and NATO chief Mark Rutte said more nations would will “ramp up defense spending” over the coming year.
The regional Stoxx 600 benchmark rose 0.61% in mid-day Frankfurt trading, while Britain’s FTSE 100 gained 0.55% in London.
Overnight in Asia, Japan’s Nikkei 225 rose 1.7%, rebounding from Friday’s five-month low, while the reginal MSCI ex-Japan benchmark edged 0.08% higher into the close of trading.
Related: Veteran fund manager unveils eye-popping S&P 500 forecast
