US futures

Dow future -0.07% at 43450

S&P futures 0.09% at 6023

Nasdaq futures 0.05% at 21560

In Europe

FTSE 0.06% at 8526

Dax  0.04% at 21007

• President Trump’s trade comments drive sentiment
• Optimism after no universal trade tariffs announced
• Netflix earnings in focus after the close
• Oil falls on Trump's increased oil output plans

US stocks rise amid relief over no immediate universal trade tariffs

U.S. stocks are rising modestly ahead of the open as investors assess Donald Trump's executive orders while awaiting his first moves on trade policy.

The US market was closed yesterday for Martin Luther King Day. However, futures are rising amid relief in the market from a slightly more measured inauguration speech. President Trump did not lay out concrete plans for universal tariffs, bringing initial relief. He has since said that he is considering imposing trade tariff on Canada and Mexico as soon as February 1.

While Trump said he was planning 25% tariffs on Mexico and Canada due to their border policies he didn't specify any plans for tariffs with China. This is being interpreted as a positive for the market. Investors are particularly sensitive to trade tariff and universal trade tariff threats given their likely inflationary effect, which could prevent the Fed from cutting rates at the pace hoped for.

In his speech, President Trump labeled his return to the White House as the start of a period of growth and success for the country, outlining his intentions to make America great. The more domestically focused Russell 2000 stands to benefit from this vision.

Asset prices in 2025 will likely be driven by Trump's policies. Uncertainty and volatility are likely to persist.

Corporate news

US-listed shares in Chinese companies jumped on relief that China has initially avoided harsh trade tariffs. Alibaba, JD.com, and Baidu are heading higher pre-open.

Automobile makers General Motors and Ford, which have supply chains spread across the US, rose 0.8% and 1.5%, respectively, ahead of the open. Tesla is also trading 2% higher

Apple has slumped after Jefferies slashed their rating of the iPhone manufacturer to underperform from hold after independent research found sales in China fell 18.2% in the December quarter

Netflix will be in focus as the streaming giant is set to report after the close. Expectations are for EPS of $4.21 and revenue of $10.11. Subscription growth could double Q3 at around 11 million owing to strong content releases and the success of advertising tiers. This will be the last quarter that subscriber numbers are released.

S&P 500 forecast – technical analysis.

The S&P 500 continues to extend its recovery from 5770 January low and tests the 6000-6050 resistance zone. A rise above here opens the door to 6100 and fresh record highs. Failure to retake this resistance zone could see the price retest the 50 SMA at 5970. A break below here exposes the 100 SMA and the 5850 support zone.

FX markets – USD rises, GBP/USD falls

The USD is rebounding after yesterday's losses as the market weighs up Donald Trump's immediate actions at his inauguration. While the USD initially fell after Trump stopped short of trade tariff plans in his speech, comments made later have revived some trade tariff concerns, lifting the USD.

 EUR/USD is edging lower after weaker-than-expected German-EW economic sentiment and risk aversion following Trump's mixed messages regarding tariff threats.

GBP/USD is falling after soft UK jobs data. Unemployment unexpectedly ticked higher to 4.4%, while payroll numbers plunged by 47k in December, the largest fall since November 2020. Vacancies also fell for the 30th straight month. The data points to a soft labour market even as wage growth accelerated to 5.6%, although this was mainly due to a base effect.

Oil falls after Trump plans to increase oil production

Oil prices are falling on Tuesday extending losses from yesterday after Trump's inauguration speech where he pledged to increase US oil and gas production.

Trump withdrew from the Paris agreement and overturned Biden's ban on offshore oil and gas drilling in specific areas on the US continental shelf to encourage increased production.

The prospect of increased supply has pushed oil prices lower.

Separately, Trump's decision to refrain from imposing trade tariffs on China at the start of his second term is a positive and could benefit both the Chinese economy and the oil demand forecast, limiting losses.

Meanwhile, the stronger U.S. dollar could also pull oil prices lower, making oil more expensive for buyers of other currencies.