U.S. stock futures edged lower late Monday as market participants weighed the potential economic fallout from proposed trade tariffs and closely monitored the progress of a high-stakes fiscal package moving through Congress.
By 7:18 p.m. ET, Dow Jones Futures fell 0.1% to 42,325.00, S&P 500 Futures slipped 0.1% to 5,940.25, and Nasdaq 100 Futures lost 0.1% to 21,510.00.
The pullback came after a mildly positive session on Wall Street. Gains in tech and energy stocks helped offset headwinds from renewed U.S.-China tensions and inflationary fears tied to tariffs.
Adding to uncertainty, Beijing rejected accusations from Washington that it violated the mid-May trade pact. U.S. Treasury Secretary Scott Bessent confirmed last week that negotiations between the two economic giants had stalled.
Tariff Hikes and Tax Bill Draw Scrutiny
Investors remained alert following President Donald Trump’s weekend announcement that steel and aluminum tariffs would be raised to 50% from 25%. While this move supported U.S.-based producers in the short term, it triggered broader concerns about prolonged inflation and global supply chain disruptions.
Meanwhile, attention turned to Capitol Hill, where a sweeping tax cut and spending bill advanced through Congress. Trump called the proposal the “single biggest spending cut in history,” but analysts caution that it could further widen the U.S. fiscal deficit.
Key drivers influencing sentiment:
- Tariff hikes could pressure input costs and inflation
- China’s pushback on trade deal allegations escalates tension
- Concerns rise over mounting U.S. government debt
Wall Street Gains Capped by Uncertainty
Despite a generally upbeat session, Wall Street’s gains were tempered by investor caution ahead of critical economic data later this week.
The S&P 500 closed up 0.4% at 5,935.94, the NASDAQ Composite gained 0.7% to 19,242.61, and the Dow Jones Industrial Average edged 0.1% higher to 42,305.48.
Support came from:
- Tech stocks, buoyed by optimistic earnings forecasts
- Energy stocks, lifted by a fresh rally in global oil prices
- Steel and aluminum producers, benefiting from tariff talk
However, falling Treasury yields offered only partial relief as bond markets continued to signal concern over long-term fiscal sustainability.
Market participants will be closely watching comments from Federal Reserve officials and the upcoming nonfarm payrolls report for May, due Friday, for clearer clues on the economic trajectory.
