U.S. stock futures edged down as markets digested mixed consumer price data and prepared for more inflation figures. Several U.S. companies are expected to release quarterly earnings soon. Meanwhile, European chip equipment supplier ASML (EU:ASML) warned it cannot confirm growth for 2026, citing possible headwinds from heightened U.S. tariffs. On the trade front, President Donald Trump announced a new deal with Indonesia, as the August 1 deadline for his elevated “reciprocal” tariffs looms.
Futures Lower
On Wednesday, U.S. stock futures dipped as investors awaited a fresh batch of corporate earnings and a key wholesale producer price index reading. By 03:37 ET (07:37 GMT), Dow futures were down 91 points (-0.2%), S&P 500 futures fell 15 points (-0.2%), and Nasdaq 100 futures declined 75 points (-0.3%).
The prior session saw the Dow Jones Industrial Average and S&P 500 dip, with markets eyeing June inflation data that broadly matched expectations but showed rising costs in goods affected by tariffs. The latest numbers have largely cemented expectations that the Federal Reserve will hold interest rates steady at its upcoming meeting, potentially escalating tensions between President Trump and Fed Chair Jerome Powell. Trump has hinted at firing Powell due to dissatisfaction with the Fed’s reluctance to cut rates quickly.
Bank earnings, which often mark the start of quarterly reports, were mixed. JPMorgan shares dipped slightly, Citigroup (NYSE:C) gained 3.7%, while Wells Fargo fell 5.5% after lowering its full-year net interest income forecast.
U.S.-Indonesia Trade Deal Announcement
Trump revealed on Tuesday that the U.S. will impose a 19% tariff on goods from Indonesia as part of a new trade agreement. Indonesia currently applies a flat 10% tariff on imports and has not imposed levies on U.S. exports.
The deal includes penalties on “transshipping,” where goods from China are routed through Indonesia to avoid tariffs. This pact follows preliminary agreements with the UK, China, and Vietnam. Trump has indicated more deals are forthcoming as the August 1 deadline for “reciprocal” levies approaches. The White House confirmed the deadline will not be delayed again after earlier market turmoil when the tariffs were first announced in April.
Estimates from Yale Budget Lab suggest the average U.S. duty rate will rise to 20.6% under Trump’s announced tariffs, up from 2-3% before his presidency.
ASML Reports
Dutch semiconductor equipment supplier ASML reported second-quarter bookings above estimates but cautioned that it may not grow in 2026. CEO Christophe Fourier cited “macroeconomic and geopolitical” challenges, particularly tariffs, as key risks.
“While we still prepare for growth in 2026, we cannot confirm it at this stage,” Fourier said. The update disappointed some analysts, highlighting uncertainties for companies in early 2025’s final six months. ASML shares dropped more than 6% in early European trading.
Not all earnings news was negative. Cartier owner Richemont (SIX:CFR) posted a 6% increase in quarterly sales to €5.4 billion, roughly meeting expectations thanks to strong jewellery demand offsetting weakness in watches.
U.S. Earnings Ahead
A busy slate of U.S. earnings is expected on Wednesday, including major banks Bank of America, Morgan Stanley, and Goldman Sachs, which may provide insight into the financial sector’s outlook.
Pharmaceutical giant Johnson & Johnson (NYSE:JNJ), known for brands like Neutrogena and Acuvue, is also reporting. United Airlines will release results after the market close. Rival Delta Air Lines (NYSE:DAL) recently reinstated guidance, citing hopes for stabilizing demand and reduced industry capacity, which could improve revenue per available seat mile.
U.S. PPI and Beige Book Due
Investors will also receive June’s producer price index (PPI), a key inflation gauge. Economists forecast headline PPI growth of 2.5% year-on-year, slightly down from 2.6% in May, with month-on-month gains of 0.2%, a slight acceleration from the previous 0.1%.
The Federal Reserve’s Beige Book will be published as well. This report, released eight times a year, gathers anecdotal data on economic conditions from interviews with businesses, economists, and market experts.
Analysts at Vital Knowledge noted, “The Beige Book has taken on added importance in the present environment given all the moving pieces influencing economic data, and it’s likely to reflect continued stagflationary forces in the domestic economy (with growth headwinds and upward pressure on prices from trade friction).”
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