Stocks looked set to rise on Wednesday, with investors hopeful that trade tensions between the U.S. and China could cool now that representatives of the world’s two largest economies are headed to the negotiating table.
Futures tracking the Dow Jones Industrial Average climbed 179 points, or 0.4%. S&P 500 futures were up 0.5%, and contracts tied to the tech-heavy Nasdaq 100 gained 0.6%.
The three blue-chip indexes had tumbled Tuesday on renewed tariff fears, but investors news of a trade summit between Washington and Beijing lifted sentiment. Officials from the U.S. and China are slated to meet in Switzerland to de-escalate the trade war that erupted between the two countries last month.
The Federal Reserve’s policy decision will be the other big story for equities on Wednesday. Investors are all-but-certain that the central bank will hold interest rates at their current level, but Chair Jerome Powell’s press conference will give the market a sense of where borrowing costs are headed amid fears that President Donald Trump’s tariff plans could push up inflation and weigh on growth.
“They’re widely expected to leave rates unchanged, but this is the first meeting since Liberation Day and the subsequent market turmoil, so it’ll be really important to gauge how the Fed are thinking about it and their reaction function,” Deutsche Bank analyst Jim Reid said in a research note.
The yield on the benchmark 10-year U.S. Treasury note ticked up 1 basis point to 4.323% in early trading. The U.S. Dollar Index, which tracks the greenback against a basket of six other currencies, climbed 0.2%.