U.S. stock futures saw a significant rebound on Wednesday following House Republicans’ progress on Donald Trump’s tax cut proposals. The movement came after the U.S. House of Representatives narrowly passed a $4.5 trillion tax-cut plan late Tuesday, sending the resolution to the Senate, where Republicans are expected to take action. This development boosted investor confidence, with Nasdaq futures rising 0.7% and S&P 500 futures climbing 0.5%. Additionally, reports of a draft minerals deal between the U.S. and Ukraine further supported positive market sentiment.
European markets followed the U.S. rally, with the pan-continental STOXX 600 index rising 1% to reach a new record high. Blue-chip indexes in Frankfurt, Paris, and London also saw notable gains, ranging from 0.7% to 1.7%. Investors are increasingly optimistic about the economic outlook, and this optimism was reflected across major global stock markets.
Meanwhile, U.S. Treasury yields saw a slight uptick as market participants anticipated more government debt issuance. The 10-year Treasury yield increased by one basis point to 4.306%, and the two-year yield rose two basis points to 4.119%. This shift followed a nearly 10 basis point drop on Tuesday, as traders adjusted their expectations ahead of potential Federal Reserve actions, including anticipated rate cuts in the coming months.
In commodities, U.S. copper prices surged more than 3.5% following an investigation into potential new tariffs on metal imports ordered by Trump, alongside a major power outage in Chile that affected copper production. The U.S. dollar also regained some strength, rising 0.3% against major currencies like the euro and yen. However, European AI-linked stocks faced challenges, with an index of popular tech stocks, the “Magnificent Seven,” dropping 2.5% amid concerns about a potential slowdown in Microsoft’s data center leasing.
SOURCE: PUNCH