Futures Slip on Trade Tensions After OECD Flags Global Risk

• U.S. stock futures declined, with S&P 500 futures down 0.25% to 5,932.25, Dow Jones Industrial Average futures falling 0.32% to 42,239.00, and Nasdaq 100 futures dropping 0.13% to 21,501.00, reflecting investor concerns over President Trump’s tariff policies and stalled U.S.-China trade talks.
• The OECD slashed its global economic growth forecast, projecting U.S. growth to slow from 2.8% last year to 1.6% this year and 1.5% in 2026, citing the detrimental impact of trade barriers on investment and confidence.
• China’s manufacturing sector contracted at its fastest pace since 2022, and the EU criticized Trump’s plan to double steel tariffs to 50%, warning of countermeasures, while markets await key U.S. labor market data and earnings from CrowdStrike (CRWD), Asana (ASAN), and Hewlett Packard Enterprise (HPE).

Global markets are navigating turbulent waters as escalating trade tensions, driven by President Trump’s tariff policies, cast a shadow over economic prospects. Investors are closely monitoring developments in U.S. trade negotiations, with stock futures reflecting heightened uncertainty. S&P 500 futures declined 15 points, or 0.25%, to 5,932.25, while Dow Jones Industrial Average futures fell 135 points, or 0.32%, to 42,239.00. Nasdaq 100 futures also slipped, dropping 28 points, or 0.13%, to 21,501.00. The VIX, a gauge of market volatility, rose 0.33, or 1.80%, to 18.69, signaling growing investor unease.

The OECD has issued a stark warning, slashing its global economic growth forecast due to the ripple effects of Trump’s trade policies. The U.S. economy, in particular, faces a significant slowdown, with growth projected to decline from 2.8% last year to 1.6% this year and further to 1.5% in 2026. These policies, centered on imposing “reciprocal” tariffs, are dampening investment and eroding business confidence worldwide. The OECD emphasized the urgency for countries to secure trade agreements to mitigate rising barriers, but progress remains elusive. Trump’s push for trade partners to deliver their “best offers” by Wednesday has met resistance, particularly as U.S.-China relations remain strained despite a nominal trade truce.

China’s manufacturing sector underscores the real-world impact of these policies, with activity contracting at its fastest pace since 2022 in May. Smaller exporters, in particular, are reeling from tariff hikes, highlighting the fragility of global supply chains. Across the Atlantic, the European Union has voiced strong opposition to Trump’s plan to double steel tariffs to 50%, warning that such measures undermine ongoing negotiations. The EU has signaled readiness to implement countermeasures, raising the specter of a broader trade conflict.

Commodities markets are also reacting to the uncertainty. Gold prices dipped $18.00, or 0.53%, to 3,379.20, reflecting a cautious retreat from safe-haven assets. Crude oil, however, edged higher by $0.31, or 0.50%, to 62.83, supported by supply dynamics. Treasury yields showed mixed signals, with the 30-year Treasury yield rising 0.066, or 1.34%, to 4.995, while the 10-year Treasury yield fell 0.030, or 0.674%, to 4.4220, indicating divergent expectations for long- and short-term economic conditions.

In the U.S., attention is turning to the labor market as a key indicator of economic resilience. An upcoming Job Openings and Labor Turnover Survey for April, due later today, will shed light on how Trump’s tariff hikes are affecting hiring and workforce dynamics. This data will set the stage for the highly anticipated May jobs report on Friday, which could influence expectations for monetary policy and economic growth.

As earnings season draws to a close, with nearly all S&P 500 (SPX) companies having reported, investors are focusing on a handful of key reports. Today, CrowdStrike (CRWD), Asana (ASAN), and Hewlett Packard Enterprise (HPE) will release their results, offering insights into how technology and enterprise sectors are weathering the trade-driven economic headwinds.
The interplay of slowing growth, rising trade barriers, and market volatility underscores the challenges facing the global economy. With deadlines looming and negotiations faltering, the path forward remains uncertain, leaving investors and policymakers alike on edge.

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