(Reuters) – U.S. stock index futures were slightly higher on Tuesday, as investors assessed the possibility of tariff relief for the auto sector after President Donald Trump floated the idea of more exemptions.
Trump on Monday suggested potential exemptions for the 25% tariffs imposed on foreign imports of autos and auto parts, saying he was “looking at something to help some of the car companies.”
Ford edged 0.6% higher, while General Motors slipped 1.1% after a brokerage downgrade.
Movements in the pharma sector, however, kept investors cautious after Federal Register filings showed the Trump administration was proceeding with probes into imports of pharmaceuticals and semiconductors as part of a bid to impose tariffs on both sectors.
Uncertainty remains high in the market. Rapid changes in U.S. policy have sparked steep market selloffs, and left investors, companies and consumers confused over the outlook for policy and economic growth.
“Once again markets (are) faced with another US ‘tariff reprieve’, this time for autos, but again this primarily only adds to uncertainty,” said Marc Ostwald, chief economist, ADM Investor Services International.
Trump on Friday exempted key electronics products from reciprocal tariffs, sparking some hope for relief from hefty U.S. levies.
Corporate results will be in focus over the next weeks for indications on how companies and consumers are coping with changes in trade policy.
Results from Bank of America, Citigroup and Johnson & Johnson are due before the bell.
A report on March import and export prices and the New York Federal Reserve’s April manufacturing survey are due on Tuesday. Richmond Fed President Thomas Barkin and Fed Board Governor Lisa Cook are also scheduled to speak later in the day.
At 5:22 a.m. ET, Dow E-minis were up 45 points, or 0.11%, S&P 500 E-minis were up 12.25 points, or 0.23% and Nasdaq 100 E-minis were up 66.25 points, or 0.35%.
The main indexes gained ground on Monday, but trading was choppy, and most analysts expect markets to remain volatile barring more clarity on policy.
Global investors have slashed their U.S. equity holdings over the past two months, and a record number of managers say they plan to keep cutting their exposure, BofA Global Research said.
The S&P 500 is down 8.1% this year, while the Dow Jones has lost about 4.8% and the tech-heavy Nasdaq Composite has slumped nearly 13%.
Among other stocks, Boeing lost 2.8% after a report said China has ordered airlines not to take any further deliveries of the company’s jets.
(Reporting by Lisa Mattackal in Bengaluru; Editing by Shinjini Ganguli)
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