U.S. stock futures showed little movement Thursday following a turbulent session in which markets reacted sharply to rumors that President Donald Trump intended to remove Federal Reserve Chair Jerome Powell. Trump later denied these reports but left the door open to a possible future dismissal. Meanwhile, a survey of U.S. companies revealed a pickup in economic activity, even as uncertainties related to tariffs continue to cloud the broader outlook.
Futures hold steady
As traders awaited a fresh wave of corporate earnings, U.S. stock futures were mostly flat on Thursday. By 03:30 ET, Dow and S&P 500 futures were essentially unchanged, while Nasdaq 100 futures edged up by 28 points, or about 0.1%.
The major indexes ended the day higher after a volatile trading session. Shares initially dropped, the dollar weakened, and gold surged following reports suggesting Trump might dismiss Powell. However, markets rebounded after Trump stated he had no plans to fire the Fed Chair.
“For less than an hour yesterday, it looked as if Trump was about to remove […] Powell,” ING analysts commented in a client note. “After yesterday’s scare, markets have probably built even more resistance to headlines on this topic.”
Investor sentiment was also supported by June’s producer price data, which showed no month-over-month change, easing some concerns sparked earlier in the week by reports of accelerating consumer inflation.
Trump denies plans to oust Powell
Much attention remains focused on Trump’s ongoing tensions with Powell. The Fed Chair has been a frequent target of Trump’s trade-related criticism, with the president faulting him for not acting swiftly to cut interest rates. Powell, citing uncertainty linked to Trump’s tariffs, has favored a cautious wait-and-see approach regarding future rate adjustments.
On Wednesday, Trump denied plans to remove Powell but stopped short of ruling out the possibility altogether. He said it was “highly unlikely” Powell would be dismissed over fraud allegations, referencing GOP complaints about the $2.5 billion renovation of the Fed’s Washington headquarters—a project defended by the Fed.
In an interview, Trump later said he would “love” to see Powell resign but acknowledged the decision ultimately rests with Powell himself. Powell, appointed by Trump in 2017, intends to complete his term, which expires in May 2026.
Beige Book shows growth amid tariff concerns
The Federal Reserve’s Beige Book report indicated that economic activity in the U.S. expanded in June and early July, though uncertainty remains due to the impact of Trump’s aggressive tariff policies.
The report, which compiles input from businesses across the country, showed that while recent weeks saw increased activity, companies remain “neutral to slightly pessimistic” about the broader economic outlook.
“Contacts in a wide range of industries expected cost pressures to remain elevated in the coming months, increasing the likelihood that consumer prices will start to rise more rapidly by late summer,” the Beige Book noted. It gathered feedback from contacts of each of the Fed’s 12 regional banks.
All districts reported seeing the effect of tariffs, often manifesting as price hikes, although some firms have benefited from the reshoring of overseas operations.
Netflix earnings in focus
Thursday will see a series of corporate earnings reports, with Netflix (NASDAQ:NFLX) grabbing particular attention after markets close.
Analysts at Vital Knowledge expect Netflix to deliver “very healthy results as its dominance” in streaming “expands,” but warn that near-term expectations may be “too frothy.”
Ahead of the opening bell, GE Aerospace (NYSE:GE), Pepsico (NASDAQ:PEP), Elevance Health (NYSE:ELV), and Cintas Corporation (NASDAQ:CTAS) are also scheduled to report their latest earnings.
According to Vital Knowledge, a recent streak of positive earnings and guidance has helped fuel optimism in equity markets.
TSMC posts record Q2 profit
Taiwan Semiconductor Manufacturing Co (NYSE:TSM) announced record second-quarter profits Thursday, beating market forecasts thanks to strong demand driven by artificial intelligence.
CEO C.C. Wei expressed confidence that AI-related demand will remain robust but urged caution about the fourth quarter of 2025 amid tariff-related uncertainties.
TSMC’s net income surged 60.7% to T$398.27 billion ($13.52 billion) for the quarter ending June 30, surpassing Reuters’ estimate of T$377.4 billion and equating to earnings per share of T$15.36.
Revenue jumped 38.6% to T$933.79 billion, propelled largely by AI-driven demand for the company’s advanced 3nm and 5nm wafer technologies—key components in cutting-edge AI processors.
These gains helped offset weaker revenue from smartphone and device chips, as well as negative currency effects.
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