US stock index futures rose on Wednesday after President Donald Trump withdrew his call to fire Federal Reserve Chairman Jerome Powell. The move was seen as easing market tensions and boosting investor confidence in the stability of the country's monetary policy. Trump also signaled more positive signs on trade talks with China, including the possibility of a major tariff cut.
The market rally was also supported by a strong performance by Tesla, which jumped 7% in pre-market trading after its automotive segment reported better-than-expected profits. CEO Elon Musk also announced that he would reduce his involvement in the Trump administration to focus fully on the companies under his leadership.
Trump's more moderate tone, particularly his statement that he had no intention of firing Powell, was seen as an effort to calm concerns about possible political interference in monetary policy. Coupled with hopes of a trade deal between the US and China, all three major indexes – the Dow, S&P 500 and Nasdaq – rose between 1.7% and 2.6%.
Tech mega-shares such as Nvidia, Alphabet, Apple and Meta also rose despite Apple and Meta being fined by the European Union. Investors are now expecting interest rates to remain unchanged at the next Fed meeting, while continuing to monitor corporate financial performance and the impact of tariffs on consumer behavior.
In currency markets, the US dollar briefly strengthened against the yen and other major currencies before stabilizing. Meanwhile, long-term US bond yields fell, reflecting reduced concerns about the credibility of the country's fiscal and monetary policies.
However, analysts stressed that risks remain, particularly related to tariffs and policy uncertainty. The International Monetary Fund (IMF) also lowered its global growth forecast. Despite the increasingly positive market sentiment, investors are advised to remain cautious by focusing on long-term strategies and being flexible in the face of market volatility.
