All three major indexes ended yesterday’s session more than 2% lower after Trump redoubled his attacks against Powell for not cutting interest rates, sparking concern about the central bank’s autonomy and the future monetary policy path.

The mood remained fragile as investors awaited Trump’s next steps vis-à-vis Powell.

Clarity on US tariff policy and the outcome of negotiations with individual countries on reciprocal levies are also in focus.

Meanwhile, Trump’s legal ability to fire the Fed chair remains unclear.

Investors have exited US assets over the last week, even as other safe-haven holdings, most notably gold, have surged.

However the dollar and US equities have slid while Treasury yields – which move inversely to prices – have risen.

“The market is pricing in a political risk premium for US assets,” said Kathleen Brooks, research director at XTB.

Those moves are “causing existential angst among investors, which is inevitably weighing on equities and risk sentiment, with US stocks in the firing line”.

Investors will focus on a slew of corporate results that are due through the week for indications on how companies are navigating the uncertainty caused by tariffs and their expectations for a hit to future earnings.

Verizon fell 3.6% after posting a higher quarterly subscriber loss, while Northrop slumped 8.7% after its quarterly results.

Tesla, which will kick off earnings for the “Magnificent Seven” group of megacap stocks after markets close, rose 0.8% in premarket trading.

Josh Gilbert, market analyst at eToro, said investors are looking for clarity on the impact of auto tariffs, Tesla top boss Elon Musk’s advisory role in the Trump administration as well as the rollout of cheaper EVs.

“Musk needs to deliver some magic and step up to the plate… these three areas will be huge in Tesla’s 2025 comeback or continued struggle,” Gilbert said.

At 6.56am, Dow E-minis were up 298 points, or 0.78%, S&P 500 E-minis were up 46.5 points, or 0.90%, and Nasdaq 100 E-minis were up 166.5 points, or 0.93%

Megacap tech stocks, among the hardest hit by yesterday’s selloff, also recovered.

Nvidia added 1.2%, Amazon.com was up 1.1% and Apple gained 1%.

First Solar gained 7.1% after US trade officials finalised steep tariff levels on most solar cells from South Asia.

Indexes have fallen sharply this year as Trump’s erratic trade policies rattled markets, with the S&P 500 16% below its Feb 19 record closing high.

A close 20% below that mark would confirm that the index has entered a bear market.

The Nasdaq Composite confirmed it was in a bear market earlier this month.

Commentary from five Fed speakers including vice-chair Philip Jefferson is expected through the day.

Their remarks are likely to be closely watched for clues on the central bank’s policy outlook and views on rising tensions with the White House.