U.S. stock futures advanced early Monday morning as investors brace for one of the most critical weeks of the year, packed with corporate earnings, economic data, and pivotal policy signals from the Federal Reserve. The market was further buoyed by a newly announced U.S.-European Union trade agreement, which lowered tariffs and sparked optimism across global equities.
Futures Rise on Trade Optimism
Futures tied to the Dow Jones Industrial Average were up 117 points (0.26%), while S&P 500 futures gained 0.32%. Nasdaq 100 futures led the rally with a 0.5% increase, reflecting investor confidence in the tech sector.
The uptick comes just hours after President Donald Trump confirmed a deal with the EU to cut tariffs on imported goods to 15%, down from a previously threatened 30%. The breakthrough offers some relief to markets after weeks of uncertainty surrounding trade relations with one of America’s biggest partners.
What’s Driving Markets This Week?
The momentum builds on a strong previous week for Wall Street, driven by robust earnings and improving international trade ties with countries like Japan and Indonesia. On Friday:
- The Dow Jones rose 208.01 points (+0.47%) to close at 44,901.92
- The S&P 500 added 0.40%, ending at 6,388.64 – its 14th record close of 2025
- The Nasdaq Composite climbed 0.24% to 21,108.32 – marking its 15th record close
Nick Savone from Morgan Stanley’s Institutional Equity Division described the mood as “upbeat,” crediting positive earnings surprises, trade deals, and growing interest in AI-related investments.
“Capex confidence, U.S.-Japan progress, and forward guidance from the AI Action Plan have all lifted investor sentiment,” Savone said in a weekend note.
Tech Earnings Take Center Stage
This week is the most active of the S&P 500 earnings season, with more than 150 companies reporting. All eyes are on the so-called “Magnificent Seven”:
- Meta and Microsoft are scheduled to report Wednesday
- Amazon and Apple will follow on Thursday
Investors are especially interested in what these companies say about AI infrastructure spending, which has been a major driver of market gains in 2025.
Fed Policy Decision Ahead
The Federal Reserve begins its two-day policy meeting on Tuesday, concluding Wednesday. While analysts expect rates to remain unchanged at 4.25%–4.5%, the key question is whether a rate cut could be on the table as early as September.
Any dovish signals from Fed Chair Jerome Powell could fuel further market gains, especially if inflation shows signs of continued moderation.
PCE Inflation, Jobs Data to Guide Outlook
On Thursday, markets will digest the June PCE price index—the Fed’s preferred inflation gauge. Economists expect:
- Year-over-year PCE: Rising to 2.4% from 2.3%
- Month-over-month PCE: Increasing to 0.31% from 0.14%
A hotter-than-expected print could dampen hopes of a near-term rate cut.
Also on tap this week:
- Tuesday: Job Openings and Labor Turnover Survey (JOLTS)
- Wednesday: ADP’s private payroll report
- Thursday: Initial jobless claims
- Friday: July jobs report (expected: 115,000 new jobs, 4.2% unemployment)
What It All Means
With earnings, economic data, central bank policy, and geopolitics converging in a single week, investors have a lot to absorb. The market’s resilience will likely be tested by forward guidance from corporate America and inflation readings, both of which may set the tone for the second half of 2025.
Still, early signs are encouraging. If the trade deal holds and earnings impress, the current bull run could stretch further—provided inflation doesn’t force the Fed’s hand too soon.
Final Takeaway
Markets are kicking off the week with a dose of optimism thanks to trade breakthroughs and strong earnings momentum. But with the Federal Reserve, inflation data, and tech earnings all on deck, investors should prepare for potential volatility ahead.
Frequently Asked Questions
Why are stock futures rising today?
Stock futures rose after the U.S. and EU reached a new trade deal to reduce tariffs, boosting investor confidence ahead of a busy week of earnings and data.
What is the U.S.-EU trade deal announced by Trump?
President Trump confirmed a new agreement lowering tariffs on European imports to 15%, avoiding the previously proposed 30% hike.
What major events are investors watching this week?
Markets are focused on tech earnings from Meta, Microsoft, Amazon, and Apple, plus the Fed’s rate decision, inflation data, and July’s jobs report.
Will the Fed cut interest rates soon?
While no rate cut is expected this week, investors are watching for signals that a cut could come in September if inflation softens.
What is the expected July jobs report figure?
Analysts forecast 115,000 new jobs in July and a slight rise in the unemployment rate to 4.2%, according to FactSet data.
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