U.S. stock futures showed little movement Tuesday as investors prepared for a fresh wave of earnings reports from major companies. So far, corporate results have generally been positive amid ongoing concerns about tariffs clouding the broader economic outlook. Meanwhile, reports indicate that the ambitious artificial intelligence collaboration between OpenAI and SoftBank is facing challenges in its rollout. Additionally, speculation is mounting over potential mergers and acquisitions in the U.S. freight rail sector.
Futures hold steady
On Tuesday morning, U.S. stock futures remained largely unchanged as traders paused ahead of the next batch of earnings announcements. By 03:31 ET, contracts tied to the Dow Jones, S&P 500, and Nasdaq 100 all showed minimal fluctuations.
The S&P 500 and the tech-focused Nasdaq Composite had both reached record highs in the previous session, supported in part by encouraging company earnings reports.
Alphabet Inc. (NASDAQ:GOOGL), the Google parent company, saw its shares rise ahead of its scheduled earnings release on Wednesday. Alphabet is among the influential “Magnificent Seven” mega-cap tech firms reporting this week, alongside Tesla (NASDAQ:TSLA), whose shares slipped slightly on Monday.
Verizon Communications (NYSE:VZ) gained roughly 4% following the company’s announcement raising the lower boundary of its full-year profit growth forecast.
While earnings season is picking up pace, markets remain focused on developments regarding sweeping U.S. tariffs. With the August 1 deadline for President Donald Trump’s increased “reciprocal” tariffs fast approaching, reports suggest that the White House has yet to make meaningful headway in trade talks with multiple countries.
How U.S. corporations respond to these potential tariff hikes will be a key theme throughout the current quarter’s earnings season.
Earnings to watch
Tuesday’s earnings calendar includes notable reports from homebuilders DR Horton (NYSE:DHI) and PulteGroup (NYSE:PHM), which may provide insights into the health of the U.S. housing market. Higher mortgage rates and economic uncertainty have recently weighed on homebuying, though analysts suggest that possible Federal Reserve rate cuts later this year could spur demand.
General Motors (NYSE:GM) has already cautioned about a $4 billion to $5 billion annual earnings impact from U.S. tariffs, and investors will be eager to hear the automaker’s outlook on trade.
Other notable reports before markets open include Coca-Cola (NYSE:KO), Philip Morris International (NYSE:PM), and defense contractors RTX Corp. (NYSE:RTX) and Lockheed Martin (NYSE: LMT). Texas Instruments (NASDAQ:TXN) and Intuitive Surgical (NASDAQ:ISRG) are set to release results after the closing bell.
After Monday’s market close, NXP Semiconductors (NASDAQ:NXPI) reported a 6% drop in second-quarter revenue, attributed to softness in its communications and infrastructure business, which led to a decline in extended-hours trading.
OpenAI and SoftBank’s AI venture hits bumps, WSJ says
A Wall Street Journal report revealed that the $500 billion partnership between OpenAI and SoftBank aimed at rapidly advancing U.S. artificial intelligence projects has struggled to gain momentum.
Citing sources familiar with the initiative, the WSJ said the project—known as “Stargate”—has significantly scaled back its near-term ambitions. Despite being announced by OpenAI CEO Sam Altman, SoftBank’s Masayoshi Son, and President Trump about six months ago, it has yet to secure a contract for a data center.
The report notes disagreements between OpenAI and SoftBank over partnership terms, including where to locate data centers.
Although SoftBank pledged to “immediately” invest $100 billion in January, the plan now involves launching a smaller data center, likely in Ohio, later this year. Both Altman and Son have stated their collaboration is progressing well.
Vital Knowledge analysts noted that this might be a “tailwind” for Microsoft (NASDAQ:MSFT), suggesting OpenAI could rely on Microsoft’s Azure cloud for a longer period than expected.
“But it does raise questions about some of the hype that’s formed around the industry, where huge investment figures are cavalierly thrown out and used as justification for ever-expanding valuations when a lot of the numbers are either recycled, double-counted, or vaporware,” the analysts said.
Freight rail sector deal chatter
According to Semafor, Berkshire Hathaway-owned BNSF has engaged Goldman Sachs to explore the possibility of acquiring a competing freight rail company.
It remains unclear whether BNSF is targeting Norfolk Southern (NYSE:NSC) or CSX Corp (NASDAQ:CSX). Meanwhile, Reuters reports that CSX, based in Jacksonville, is in discussions to bring on financial advisors.
These developments follow reports that Union Pacific (NYSE: UNP), the largest U.S. freight operator, is considering buying Norfolk Southern to create an extensive $200 billion rail network spanning the continental U.S. This would rank among the most significant deals in the sector since Canadian Pacific merged with Kansas City Southern four years ago, with Goldman Sachs playing a key advisory role.
Analysts warn that any such transaction may face regulatory scrutiny, raising questions about the Trump administration’s stance on major mergers.
Gold retreats from recent peak
Gold prices eased slightly on Tuesday, pulling back from a one-month high reached in the previous session due to some profit-taking and a modest U.S. dollar rebound.
The precious metal’s safe-haven status had been bolstered by reports that the European Union is preparing countermeasures in response to the U.S.’s “reciprocal” tariffs. Washington reportedly seeks tariffs of at least 15% on the EU, while Brussels aims to maintain the current 10% rate.
Uncertainty about U.S. interest rates and Federal Reserve independence has also supported demand for safe assets. The Fed is widely expected to hold rates steady next week despite President Trump’s calls for immediate cuts.
Spot gold slipped 0.4% to $3,383.63 an ounce, with futures down 0.3% to $3,395.62 an ounce as of 03:30 ET. On Monday, spot gold jumped 1.4% to nearly $3,400 per ounce.
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