US stocks rise amid rate cut cheer; retail sales flat in June By Investing.com

Investing.com — U.S. stock index futures edged higher Tuesday, extending gains from the session amid increasing optimism over interest rate cuts, while bets on Donald Trump securing a second term also grew. 

At 06:40 ET (10:40 GMT),  rose 18 points, or 0.1%,  climbed 10 points, or 0.2%, and gained 36 points, or 0.2%. 

Powell flags confidence in lower inflation, rate cut bets surge

Wall Street indexes closed higher Monday, buoyed by optimism of the likelihood of interest rate cuts in the near future. The rose 0.5% to a record-high close, while the rose 0.3% and the climbed 0.4%. 

Federal Reserve head Jerome Powell said that recent inflation readings had boosted the Fed’s confidence in lower inflation, ramping up bets that the central bank was close to cutting interest rates. 

Powell had earlier signaled that the Fed did not have to wait for inflation to reach 2% before cutting rates. His comments sparked a sharp increase in bets that the central bank will cut rates in September.

Traders were no longer seen pricing in the possibility of a hold in September, and were now looking at a 89% chance the central bank will cut rates by 25 basis points. Traders were also seen pricing in a small chance the bank will cut rates by 50 basis points, according to .

Trump names running mate as shooting boosts presidential odds 

Wall Street largely shrugged off any political uncertainty stemming from an assassination attempt on Trump at a Pennsylvania rally over the weekend.. 

Trump on Monday was officially nominated as the Republican frontrunner for the 2024 presidential race, and named Ohio Senator J.D. Vance as his vice presidential running mate.

Trump’s chances of a victory were seen increasing sharply after the shooting over the weekend, with a Trump presidency presenting the prospect of a looser regulatory environment in the country. Trump Media & Technology Group (NASDAQ:) jumped over 30% after the attack, but saw some consolidation in aftermarket trade.

More bank earnings as Goldman impresses 

Sentiment was also supported by stronger-than-expected earnings from Wall Street major Goldman Sachs (NYSE:), which extended a parade of mostly positive bank earnings. 

The banking sector will remain in focus Tuesday, with the likes of Bank of America (NYSE:), Morgan Stanley (NYSE:) and Charles Schwab (NYSE:) scheduled to report quarterly earnings before the open.

A lot of focus will also be on the release of the U.S.  data for June.

This is expected to show a fall of 0.3% on a monthly basis, as consumers struggle with elevated interest rates and high prices. 

Crude heads lower 

Crude prices slipped lower Tuesday, on continued worries of a slowing Chinese economy.

By 06:40 ET, the U.S. crude futures (WTI) dropped 0.9% to $80.12 a barrel, while the Brent contract fell 0.8% to $84.14 a barrel.

The world’s second-largest economy, and largest crude importer, registered its weakest growth since the first quarter of 2023,

The latest forecast of inventories, from the , are due later in the session.

(Ambar Warrick contributed to this article.)