US stock futures edged higher on Tuesday as China’s careful response to President Donald Trump’s tariff hike eased market nerves over the prospect of a deepening trade war.
Dow Jones Industrial Average futures (YM=F) rose roughly 0.2%, while S&P 500 futures (ES=F) stepped up 0.3%. Contracts on the tech-heavy Nasdaq 100 (NQ=F) put on 0.4%.
Rising fears of a full-on trade war drove a sell-off in stocks on Monday after the president said there was “no room left” for Canada or Mexico to strike a deal to mitigate promised tariffs.
Spirits have turned cautiously upbeat as markets assess the fallout from Trump delivering on those broad tariffs on America’s top trading partners. The measures — fresh 25% tariffs on Canada and Mexico, and a doubling in China duties to 20% — were signed into effect at midnight ET on Monday.
Canada hit back with a sweeping package of immediate tariffs on US imports, while China retaliated with additional 15% duties on US farm products such as chicken and pork, to come in on March 10.
Relief followed Beijing’s response, seen as less aggressive than feared and leaving room for negotiation with Trump. That helped set stocks up for a revival.
In earnings, retail giants Best Buy (BBY) and Target (TGT) will report quarterly results before the market opens on Tuesday. Crowdstrike (CRWD) and Nordstrom (JWN) will release their reports after the bell.
Shares of Okta jumped in premarket trading Tuesday after the identity and cybersecurity company reported solid sales, earnings, and 2025 profit guidance.
All three metrics beat Wall Street analysts’ estimates as the company benefitted from increased corporate spending on cybersecurity protection amid the AI boom.
Okta stock rose 14% Tuesday morning and was a trending ticker on Yahoo Finance.
“This is a blowout quarter,” Okta co-founder and CEO Todd McKinnon told Yahoo Finance’s Brian Sozzi in an Opening Bid podcast exclusive. “It’s reflective of big deals in the quarter,” McKinnon said, pointing to a 25% surge in subscription backlog to more than $4 billion.
Read more here.
Target’s (TGT) earnings just hit the wires.
And while the earnings beat will quickly grab your eyes, it’s more important to lock in on this line from the release given all the risk around tariffs:
“In light of ongoing consumer uncertainty and a small decline in February net sales, combined with tariff uncertainty and the expected timing of certain costs within the fiscal year, the company expects to see meaningful year-over-year profit pressure in its first quarter relative to the remainder of the year,” Target said.
Target declined to share specific first quarter earnings guidance. Yahoo Finance data shows Wall Street analysts were looking for a slight first quarter year-on-year earnings improvement.
Economic data: No notable economic data expected.
Earnings: Target (TGT), Best Buy (BBY), AutoZone (AZO), On Holding (ONON), CrowdStrike (CRWD), Nordstrom (JWN), Ross Stores (ROST)
Here are some of the biggest stories you may have missed overnight and early this morning:
Trump pulls trigger on threatened tariffs that could recoil on US
Canada hits back with sweeping tariffs on $107B of US products
Trump 2.0’s agenda is hitting the economy at a fragile moment
China puts extra tariffs of up to 15% on major US farm imports
GOP lawmakers turn up the heat on the Fed over dual mandate
Tesla’s EV sales in China fall 49% in February
China leaves door open for talks with measured tariff response
Why tariffs ‘aren’t the problem’ in the stock market: Veteran
China’s tit-for-tat move to Trump was to slap tariffs of up to 15% on US farm goods such as pork and beef, starting next week. That’s going down generally well on Wall Street, which sees the targeted action as designed to avoid escalating a trade war between the world’s top two economies.
Bloomberg reports:
The Chinese response throws the ball back into the US court, with Trump’s review of Beijing’s compliance with the first trade agreement due in April adding to the urgency for negotiation. While Trump signaled a desire to speak with President Xi Jinping early last month, they have yet to have a call since the US leader took office.
“So far, China has given a measured, proportional response as they do not want to further escalate the situation,” said Henry Gao, a law professor at Singapore Management University who researches Chinese trade policies. “Once the April measures are out, that’s when China will likely negotiate with the US.”
The latest trade salvos came a day before Xi heads into the government’s biggest political meeting of this year, where his lieutenants will unveil their economic blueprint for 2025.
“I think the two most important reaction measures are still yet to come: the PBOC’s currency response and the fiscal package to be announced at the National People’s Congress,” said Christopher Beddor, deputy China research director at Gavekal Dragonomics in Hong Kong.
Read more here.
US President Donald Trump’s plan for wide-ranging tariffs against Canada and Mexico has occurred with no further delays.
Yahoo Finance’s Ben Werschkul reports:
A second round of tariffs from Donald Trump starts today with new duties on America’s top three trading partners: Canada, China, and Mexico.
There is “no room left for Canada or for Mexico,” Trump reiterated Monday afternoon at the White House, saying he wouldn’t pare back his tariffs levels on those two countries.
“They’re all set,” he added.
The president is imposing 25% duties on Canadian and Mexican imports following a 30-day pause. He is also implementing a second round of 10% duties on Chinese imports to increase the blanket tariffs on that nation to 20%.
The president signed an action on Monday afternoon with the new duties against China in an order that charged the country “has not taken adequate steps to alleviate the illicit drug crisis.” The duties on Canada and Mexico required no action this week as Trump’s previously signed order — with a March 4 deadline — simply went in into effect.
Read more here.
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In This Article:
Okta stock jumps on ‘blowout quarter’
Ignore the Target earnings beat
Good morning. Here’s what’s happening today.
Xi leaves door open for talks with Trump
President Donald Trump’s tariffs take effect
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