Dow Futures exhibit a slight decline, as market participants focus on the potential for forthcoming U.S. trade agreements. No agreements are anticipated to emerge from the upcoming meeting of Group of Seven finance ministers in Canada this week, as reported by Reuters. However, it is indicated that discussions between the U.S. and Japan are scheduled to take place in the near future. President Donald Trump’s tariff agenda will likely play a central role in Home Depot’s latest earnings, particularly after Walmart noted that it would probably soon raise prices because of the levies. U.S. stock futures experienced a slight decline on Tuesday, as investors largely dismissed the recent Moody’s downgrade of U.S. credit and expressed optimism for additional trade agreements from the Trump administration.

The Dow futures contract experienced a decline of 75 points, representing a decrease of 0.2%. Meanwhile, S&P 500 futures fell by 20 points, equivalent to a 0.3% drop, and Nasdaq 100 futures decreased by 95 points, or 0.4%. The primary indices on Wall Street experienced an uptick on Monday, recovering from an early decline that followed Moody’s downgrade of credit ratings late in the previous week. U.S. Treasury yields have retraced slightly from an initial surge, yet they continue to occupy elevated levels. “Stocks continue to benefit from the momentum generated by last week’s ‘Big 3’ sources of bullish news (tariff de-escalation with China, cool U.S. inflation data, and healthy April-end earnings), and there were no developments on Monday to disrupt that trend,” analysts at Vital Knowledge noted in a communication to clients.

The U.S. Treasury Department is not anticipated to disclose any trade agreements during the upcoming meeting of Group of Seven finance ministers in Canada this week, according to a report by Reuters. According to a source familiar with the discussions, the Treasury Department will refrain from endorsing a joint communique unless it aligns with their interests. Treasury Secretary Scott Bessent is scheduled to engage with Japanese counterparts during the meeting in the Canadian province of Alberta, according to reports from the news agency. Later this week, trade negotiations between Japan and the U.S. are scheduled to occur, marking the third round of high-level discussions between the two nations, as reported by Japan’s Kyodo News agency on Tuesday.

Following the announcement of an agreement between the U.S. and China last week, investors have been keenly anticipating further trade developments. Trump had previously postponed the implementation of stringent tariffs on a majority of nations; however, the timeline is approaching the conclusion of that reprieve in July. Bessent will also urge allies at the G7 to implement measures addressing the spillover effects of non-market economies such as China, according to a Treasury spokesperson who spoke to Reuters. U.S. officials, including Bessent’s predecessor Janet Yellen, have contended that China poses a risk to employment in market economies by inundating the global market with inexpensive goods.

On the earnings calendar, investors are evaluating the results from Home Depot. The group disclosed its first quarter fiscal 2025 results, which surpassed revenue expectations yet did not meet earnings projections, while reiterating its full-year outlook. The equity experienced a 2.2% increase in premarket trading subsequent to the announcement. The world’s largest home improvement retailer reported revenue of $39.86 billion, exceeding analyst expectations of $39.25 billion and reflecting a year-over-year growth of 9.4%. Adjusted earnings per share were reported at $3.56, falling short of the consensus estimate of $3.59.

Overall, comparable sales experienced a decline of 0.3%, while in the U.S., they saw a modest increase of 0.2%. The total company comparable sales experienced a negative impact of roughly 70 basis points due to fluctuations in foreign exchange rates. In a recent report by Bloomberg News, it was noted that the retailer’s CFO indicated the company will not increase prices as a result of tariffs. Any commentary from the company regarding its pricing strategy is likely to be closely examined, particularly following Walmart’s announcement last week that it plans to increase prices soon due to cost pressures stemming from Trump’s aggressive tariffs.

China has reduced its benchmark lending rates for the first time since October, while major state banks have lowered their deposit rates. This move reflects Beijing’s efforts to ease monetary policy in order to support the struggling economy. The People’s Bank of China has declared a reduction in its one-year loan prime rate, a crucial indicator utilized by financial institutions, which has decreased by 10 basis points to 3.0%. The five-year rate, a significant determinant of home mortgage rates, decreased by the same margin to 3.5%.

While the move was largely expected, analysts interpreted the modest scale of the drawdowns as a sign of possible caution among policymakers who are presently engaged in discussions regarding the uncertainties surrounding U.S. tariffs. Last week, Washington and Beijing reached an agreement to reduce their reciprocal tariffs and postpone the implementation of the duties until August. Nonetheless, universal tariffs of 10% continue to be enforced, alongside 20% levies associated with China’s purported involvement in the influx of the illegal drug fentanyl into the United States.

Oil prices experienced a decline as market participants processed indications of a weakening U.S.-Iran nuclear agreement, alongside the implications of potential negotiations for a ceasefire between Russia and Ukraine that impacted overall sentiment. Brent futures experienced a decline of 0.6%, settling at $65.16 per barrel, while U.S. West Texas Intermediate crude futures also fell by 0.6%, reaching $61.75 per barrel.

On Monday, Iran reiterated that its uranium enrichment program is “absolutely non-negotiable,” a position that remains a significant obstacle in nuclear discussions with the United States. A successful agreement may facilitate the relaxation of sanctions and subsequently boost Iranian oil exports, thereby influencing global energy markets.

Investors are closely observing the conflict in Ukraine, given that a resolution may significantly influence energy markets and geopolitical stability. After a phone conversation with Russian President Vladimir Putin on Monday, Trump announced that Russia and Ukraine had reached an agreement to initiate immediate ceasefire discussions. Nevertheless, the Kremlin signaled that these discussions would require a considerable amount of time, whereas Trump expressed his reluctance to align with certain European nations in exerting pressure on Moscow via new sanctions.