U.S. equity futures traded in a narrow range on Wednesday as investors focused on President Donald Trump’s upcoming summit in China, persistent inflation concerns and a fresh round of corporate earnings. Trump is expected to meet Chinese President Xi Jinping later this week, with trade, Taiwan and the conflict involving Iran likely to dominate discussions. Meanwhile, Cisco Systems (NASDAQ:CSCO) is set to report quarterly results, while the U.S. Senate is preparing to confirm Kevin Warsh as the next chair of the Federal Reserve.
Futures little changed ahead of key developments
At 03:33 ET, Dow Jones futures were down 26 points, or 0.1%, while S&P 500 futures edged up 12 points, or 0.2%. Nasdaq 100 futures outperformed with gains of 151 points, or 0.5%.
U.S. stocks closed mixed in the previous session as investors balanced concerns surrounding tensions between Washington and Tehran against weakness in semiconductor shares, which had recently rallied strongly on optimism tied to artificial intelligence.
Investor sentiment was also pressured by inflation data showing U.S. consumer prices rose sharply again in April following another significant increase the previous month. Markets remain concerned that the Iran conflict and the ongoing disruption to shipping through the Strait of Hormuz are contributing to higher energy costs, potentially fueling inflation and forcing central banks to maintain restrictive monetary policy.
Those concerns pushed market expectations for Federal Reserve rate hikes by next April to 20 basis points. Treasury yields also moved higher, with the benchmark 10-year yield reaching its highest level since June 2025, while the rate-sensitive 2-year yield also advanced. Rising bond yields can reduce demand for equities as investors shift toward fixed-income assets.
Trump and Xi expected to discuss trade and Iran
Attention is increasingly turning toward China, where Trump is expected to meet Xi Jinping in a highly anticipated summit later this week.
Although trade relations and Taiwan are expected to feature prominently on the agenda, analysts believe the conflict between the United States and Iran could become the central focus of the talks.
Some market observers have suggested China — one of the largest importers of Iranian crude — could potentially help support a longer-term peace arrangement. However, expectations for a major diplomatic breakthrough have cooled in recent days.
Negotiations between Washington and Tehran appear to have stalled. Earlier this week, Trump rejected Iran’s response to a U.S. peace proposal, calling it “unacceptable” and a “piece of garbage.” Speculation has also grown over whether the White House could resume military strikes against Iran.
Iran, meanwhile, has not signaled any intention to offer additional concessions to the Trump administration.
Oil prices remain elevated
The ongoing deadlock has effectively kept the Strait of Hormuz — a strategically vital shipping route handling roughly one-fifth of global oil supply — largely closed for weeks.
Analysts at Deutsche Bank said in a note that there is “increased nervousness [among investors] that a U.S.-Iran deal looks further away than most would have hoped when the more positive news flow came through a week ago,” referring to earlier reports suggesting an agreement could be close.
As a result, crude prices continue to trade well above the roughly $70-per-barrel levels seen before the U.S. and Israel launched military operations against Iran in late February. Brent crude futures, the international benchmark, were last down 0.9% at $106.82 a barrel.
Cisco earnings to kick off April-quarter reporting
Investors are also awaiting earnings from Cisco Systems (NASDAQ:CSCO), due after the closing bell in the U.S.
Cisco’s report will effectively begin the reporting season for companies with fiscal quarters ending in April. Previous earnings covering periods ending in March generally came in ahead of expectations and helped support broader equity markets despite mounting geopolitical and inflation concerns.
Back in February, Cisco posted adjusted gross margins that missed forecasts, partly because of a sharp rise in memory chip costs. Demand linked to AI infrastructure expansion has contributed to processor shortages and higher input prices across the technology industry.
At the time, chief executive Chuck Robbins said Cisco was responding by increasing prices and revising customer contract terms.
Senate expected to approve Warsh as next Fed chair
The U.S. Senate is expected to vote later Wednesday on confirming Kevin Warsh as the next Federal Reserve chair, replacing current chair Jerome Powell.
On Tuesday, senators approved Warsh’s nomination to the Federal Reserve Board of Governors in a 51-45 vote, giving him a 14-year term on the central bank’s board.
The vote largely split along party lines, although Democratic Senator John Fetterman joined Republicans in backing Warsh’s confirmation.
Warsh was selected by Trump, who has repeatedly called on the Federal Reserve to lower interest rates in an effort to support economic growth.
