On Sunday evening, U.S. stock index futures showed a slight decline, with Dow Jones Industrial Average futures falling 44 points, a drop of 0.10%; S&P 500 futures falling 0.15%; and Nasdaq futures fell 0.23%.
It is worth noting that the S&P 500 index has performed strongly recently, boosted to within 2.4% of its all-time high in February, driven by a strong employment report released on Friday.
Looking back at that time, President Donald Trump's trade war hit the market hard, and now the market is gradually recovering under the positive effects of employment data, just one step away from the historical high.
This week can be regarded as an important week in the financial market, and two key events will become the focus.
First, a new round of Sino-US trade negotiations are about to begin. Last month, the two countries agreed to suspend the imposition of high tariffs in Geneva, and officials will hold talks in London on Monday to officially kick off a new round of negotiations. It is worth noting that since the downgrade of the trade war, the two sides have accused each other of violating the agreement. The key crux of the United States lies in the supply of rare earths - as an important resource dominated by China, rare earths are crucial to the fields of automobiles, technology and national defense.
Secondly, the key inflation report will be released soon. The Fed is currently on the stand-by and see to evaluate the impact of Trump's tariffs on prices. This inflation data will provide an important reference for the Fed's policy direction.
In the bond market, the 10-year U.S. Treasury yield fell less than 1 basis point to 4.506%, indicating that the market demand for fixed income assets is relatively stable.
In the foreign exchange market, the US dollar's performance was slightly under pressure, down 0.11% against the euro and 0.15% against the Japanese yen. Although Trump's move to Los Angeles to send the National Guard may not directly trigger a reaction from Wall Street, its overall immigration crackdown has had an impact on the economy's labor supply, which in turn has an indirect impact on the dollar's trend.
The commodity market is showing a differentiated pattern. Gold prices fell 0.28% to $3337.20 per ounce, reflecting the relatively sluggish market risk aversion sentiment; crude oil prices rose slightly, with U.S. oil prices rising 0.08% to $64.63 per barrel, and Brent crude oil prices rose 0.05% to $66.50 per barrel, showing moderate expectations for crude oil demand.
Kevin Hassett, director of the US National Economic Commission, expressed optimism on Sunday, and told CBS News: "I am very happy that the deal is about to be completed." This remark has injected some confidence into the market, and the market looks forward to substantial progress in the London talks and further easing the trade situation.
However, the market still needs to be vigilant about potential risks. Tesla's stock price may face further downward pressure as Trump announced the end of his relationship with CEO Elon Musk; the release of inflation data may also trigger a market re-evaluation of the Federal Reserve's monetary policy, which in turn affects the trend of the stock and bond market.
Overall, the two key events this week will become the core forces driving the market. Investors need to pay close attention to relevant progress and data release to grasp market trends.
