S&P 500, Nasdaq Futures Rise as Tariff Truce, Tech Earnings Eyed
The US stock market was poised for a positive start on Monday, with S&P 500 and Nasdaq 100 futures rising 0.10% and 0.20%, respectively, as traders eyed a likely 90-day extension of the China tariff truce and key tech earnings. The optimism was fueled by a forecast from Morgan Stanley’s Michael Wilson, who predicted strong 12-month returns for the market, citing the growth potential of artificial intelligence (AI), tax breaks, the weakening US dollar, and the possibility of interest rate cuts by the Federal Reserve in 2026.
The futures market is a critical indicator of the direction of the stock market, and a rise in futures is often seen as a positive sign for investors. In this case, the S&P 500 futures were up 0.10%, while the Nasdaq 100 futures were up 0.20%. The S&P 500 is a widely followed index of the US stock market, tracking the performance of 500 large-cap companies, while the Nasdaq 100 is a tech-heavy index that tracks the performance of 100 non-financial stocks listed on the Nasdaq exchange.
The tariff truce between the US and China has been a major driver of market sentiment in recent weeks. The two countries have been engaged in a trade war since 2018, and the ongoing negotiations have been seen as a key factor in the market’s performance. A 90-day extension of the truce would provide a temporary reprieve from the tariffs and could help to reduce uncertainty in the market.
In addition to the tariff truce, traders were also eyeing key tech earnings from companies such as Intel and Micron Technology. Tech earnings are a critical component of the market’s performance, as they provide insight into the growth potential of the sector. Strong earnings from tech companies can help to boost the overall market, while weak earnings can lead to a decline.
Morgan Stanley’s Michael Wilson, a prominent market strategist, has been a vocal advocate for the market’s potential. In a recent note, he forecast strong 12-month returns for the S&P 500, citing the growth potential of AI, tax breaks, the weakening US dollar, and the possibility of interest rate cuts by the Federal Reserve in 2026.
AI is a key driver of growth for many companies, and the sector has been a major beneficiary of the market’s recent rally. Tax breaks, such as the Tax Cuts and Jobs Act, have also helped to boost the market, as companies have been able to retain more of their earnings and invest in growth initiatives. The weakening US dollar has also been a positive factor for the market, as it makes US exports more competitive and can help to boost economic growth.
In addition to these factors, Wilson also cited the possibility of interest rate cuts by the Federal Reserve in 2026 as a positive factor for the market. The Fed has been raising interest rates in recent years to combat inflation and slow down the economy, but many economists believe that the Fed may need to cut rates in the future to stimulate the economy.
The market’s performance was also supported by a strong jobs report on Friday, which showed that the US economy added 225,000 jobs in December, beating expectations. The unemployment rate fell to 3.5%, and wage growth remained strong, providing further evidence that the economy is strong.
In conclusion, the S&P 500 and Nasdaq 100 futures rose on Monday as traders eyed a likely 90-day extension of the China tariff truce and key tech earnings. The optimism was fueled by a forecast from Morgan Stanley’s Michael Wilson, who predicted strong 12-month returns for the market, citing the growth potential of AI, tax breaks, the weakening US dollar, and the possibility of interest rate cuts by the Federal Reserve in 2026. The market’s performance was also supported by a strong jobs report on Friday, which showed that the US economy added 225,000 jobs in December, beating expectations.
