Investing.com – US stock futures edge higher on Wednesday as traders analyzed comments from President Donald Trump on his plans for possible tariffs and poured over fresh corporate earnings. Trump takes aim at America’s trade relationship with the European Union and China in remarks on Tuesday. Elsewhere, Netflix (NASDAQ:NFLX) posts solid fourth-quarter returns, fueling a spike in shares of the streaming video giant in extended hours trading.
1. Futures inch higher
US stock futures hovered above the flatline on Wednesday, with investors gauging trade policy statements from President Trump and assessing a string of company results this week.
By 03:42 ET (08:42 GMT), the Dow futures contract had added 59 points or 0.1%, S&P 500 futures had edged up by 24 points or 0.4% and Nasdaq 100 futures had advanced by 169 points or 0.8%.
The main averages on Wall Street ended the previous session higher as traders digested Trump’s first actions following his return to the White House. Equities were somewhat buoyed by Trump’s move to avoid slapping harsh day-one import tariffs on friends and foes alike, although he told reporters he was considering placing levies on Mexico and Canada as soon as February 1. Tariffs on the European Union and a punitive duty on China were also being discussed, Trump said (more below).
Shares in American carmakers rose on Tuesday, while utilities stocks also increased following a string of orders from Trump which aimed to boost US energy production.
Markets have been closely monitoring any developments around Trump’s plans for a more protectionist trading stance, which some analysts have argued could fuel inflationary pressures and cause the Federal Reserve to delay rolling out potential interest rate cuts in 2025. The Fed is widely tipped to leave borrowing costs unchanged at its meeting next week.
“You can be sure that big changes are coming as far as US trade is concerned, even if we didn’t get any new tariffs on President Trump’s first day in office,” analysts at ING said in a note.
2. Trump issues tariff threats to EU, China
Despite signs of some relief in financial markets after Trump’s orders stopped short of introducing immediate tariffs, sentiment remained cautious as comments from the new president underlined the tougher trading position he could assume during his second term in power.
Trump hit out at the EU and China in particular on Tuesday, accusing the former of being “very, very bad to us” and claiming that fentanyl is coming into the US from the latter through Mexico and Canada.
The EU had a troubling trade surplus with the US, Trump said, adding that the bloc is “going to be in for tariffs” because it is the only way to “get fairness”.
China, meanwhile, is facing a 10% levy on all goods sent to the US as early as February 1, Trump noted, aligning with a deadline he set for Mexico and Canada earlier this week. Trump, who had previously vowed to impose as much as a 60% tariff on China, said that the threat of the duties may force Beijing to clamp down on the trade of fentanyl across US borders.
On Monday, Trump threatened to hit Canada and Mexico with 25% tariffs on imported goods unless they crack down on the drug and the trafficking of illegal migrants. Leaders in both countries moved to strike conciliatory tones with Washington in the wake of the statements.
3. Trump calls memecoin returns “peanuts”
Trump largely brushed off questions about adding billions of dollars to his personal wealth through the release of the $TRUMP memecoin before his inauguration.
Responding to questions from a reporter about the memecoin, Trump confirmed that he had launched the token, but claimed to not have too much knowledge of his personal benefit from its performance.
“I don’t know about benefited, I don’t where it is, I don’t know much about it other than I launched it, I heard it was very successful,” Trump said in a White House event on Tuesday.
When responding to a reporter telling him that he had made “several billion dollars” from the memecoin, Trump said “that’s peanuts for these guys”, referencing a group of tech billionaires who were with him to unveil a new artificial intelligence initiative.
Shortly after $TRUMP was launched last week, the token surged to a market capitalization of over $14 billion at its peak, netting Trump, who is a major holder, billions in paper gains. But the memecoin has swung wildly in volatile trade, raising some questions over potential price manipulation.
4. Netflix shares jump on strong fourth-quarter earnings
Netflix shares surged in extended hours trading Tuesday after reporting better-than-expected fourth-quarter results bolstered by a spike in subscriber additions.
In the three months ended December 31, Netflix reported earnings of $4.27 a share on revenue of $10.25 billion, topping estimates of $4.20 on revenue of $10.1 billion, according to an average of analysts’ projections cited by Reuters.
The streaming giant raked in 18.9 million users in the fourth quarter, well above the 9.2 million estimated, underpinned by a strong content slate and growing demand for membership to its ad-sponsored tier.
A slate of other corporate returns are due out this week, including quarterly figures from Procter & Gamble (NYSE:PG), Johnson & Johnson (NYSE:JNJ) and Abbott Laboratories (NYSE:ABT) on Wednesday.
5. Oil slips
Oil prices slipped lower Wednesday, adding to the previous session’s losses on the back of President Trump’s declaration of a national emergency to ramp up energy production.
By 03:43 ET, the US crude futures (WTI) dropped 0.4% to $75.50 per barrel, while the Brent contract fell 0.3% to $79.03 a barrel.
The benchmarks retreated on Tuesday after Trump laid out his plan to maximize oil and gas production, including by declaring a national energy emergency to help the rolling back environmental protections, and withdrawing the US from the Paris climate pact.
(Reuters contributed reporting.)
