US Stock Futures Decline Amid Escalating Tensions With China Over Trump's Tariff Wars: Cathie Wood Pitches ‘Mar-a-Lago’ Accord As Treasury Yields Spike

U.S. stock futures edged lower on Wednesday morning, indicating a decline in investor sentiment and the possibility of a fifth consecutive day of losses as Trump tariffs of 104% against China kicked in at midnight.

While the Dow Jones futures were down 0.6% at the time of writing, the S&P 500 and the Nasdaq Composite futures fell 0.3% each. Futures of the Russell 2000 index declined by nearly 0.6%, indicating weakness in small-cap stocks.

Asian markets ended Wednesday on a mixed note, with the Taiwan Weighted index falling 6.1% and the Nikkei 225 declining 4.1%. The Hang Seng gained 0.7%, while the Shanghai Composite closed the day with gains of 1.3%.

US equities witnessed a volatile day of trading on Tuesday, with the major indices see-sawing from intraday gains of between 1% to 2% to ending the day in the red.

The Dow Jones closed 0.8% lower, followed by S&P 500 with a decline of 1.6%. The tech-heavy Nasdaq Composite fell almost 2.2% as Trump’s hawkish China stance spooked investors.

Meanwhile, the SPDR S&P 500 ETF Trust (SPY) was down 1.6% on Wednesday morning, while Invesco QQQ Trust (QQQ) fell 1.3%.

Bitcoin (BTC) experienced a decline, too, falling nearly over 3.8% in the past 24 hours.

A ‘Mar-a-Lago Accord’ To Reassure Markets?

Ark Invest founder and CEO Cathie Wood sought an intervention by the Trump administration in coordination with the U.S. Federal Reserve.

Wood referred to the rapid rise in Treasury yields, suggesting that there are “serious liquidity issues” in the country’s banking system, in a post on social media platform X.

For reference, the 10-year Treasury yields shot up to 4.40% at the time of writing from 3.90% on Monday.

Meanwhile, Deutsche Bank macro strategist Henry Allen wondered if the Federal Reserve would have to intervene.

“Given the scale of the rout, that’s raising questions about whether the Federal Reserve might need to respond to stabilize market conditions, and we can even see from fed funds futures that markets are pricing a growing probability of an emergency cut, just as we saw during the Covid turmoil and the height of the GFC in 2008,” Allen said, according to a report by CNBC.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Also See: Ex-Treasury Secretary Larry Summers Calls Trump Tariff Impact 'Our First Iatrogenic Financial Crisis,' Warns Of Likely Recession

Share

·

Add us on