Where Are Markets Today?

U.S. and European stock futures edged lower Wednesday, a reflection of growing investor unease ahead of a high-stakes group of earnings and inflation readings. Dow shed 0.2%, S&P 500 shed near 0.3%, and Nasdaq 100 shed 0.3%, a reflection of a risk-off theme that was running itself through globally. In Europe, the FTSE 100 faces a tentative start after having weakened near its record high of 9,000, which was based on spill-over anxiety from U.S. headline inflation readings and today's U.K. CPI report. Markets were absorbing Tuesday's 0.3% monthly U.S. CPI, which was above market estimates but reinforced the thinking that for the moment, at least, inflation is stuck.

Yesterday, the market fell 0.4% for S&P 500, Dow Jones shedding more than 400 points, whereas Nasdaq Composite gained a small 0.2%—its punch being delivered largely through a 4% gain for Nvidia, which reported that Chinese sales of its H20 chips would be resumed. Such a report boosted the tech-weighted index, but wasn’t quite sufficient to give the overall mood a lift. Futures are lower today with attention now turning to the big reading later today on a top theme of market current positioning being tested—the U.S. Producer Price Index (PPI)—which can confirm or turn around interest rate cut market current positioning. There are two behemoth forces driving futures lower today. Number one, the inflation story: while CPI arrived on time, investors are looking for PPI and Core PPI to know if upstream pricing pressure can be measured. A hotter-than-expected print would nearly eliminate a near-term drop, placing downward pressure on the value of equities, particularly at rate-sensitive corners. Number two, corporate earnings are in the spotlight. While the third wheel of JPMorgan, Wells Fargo, and Citigroup smashed earnings, bad guidance along with compounding cost structures have left hope reeling. Traders today are preparing to listen to Bank of America, Morgan Stanley, Goldman Sachs, and Johnson & Johnson, where a miss on earnings or margin squeeze can extend the pullback.

Across Europe, the playbook is the same. Inflation uncertainty is being met with earnings season angst. After momentarily touching at record highs, the FTSE 100 pulled back as market participants were defensive ahead of U.K. CPI numbers. Both Atlantic coasts are similarly attuned to positioning against macro cues and central bankoratory. On pressure on central banks to hit just right, with geopolitical threats—from tariffs to digital policy change—hanging highly mobile, markets navigate the week's middle session with a defensive stance. Whether becomes a sustainable downside or buy-the-dip theme is yet to be determined, pending today numbers against the direction imparted through the week's follow-through corporate earnings.

Major Index Performance through Wednesday, July 16, 2025

• Nasdaq Composite: lower modestly, as overall tech profit-taking offsets gains in AI.
• S&P 500: flat, powered by a large-cap advance.
• Russell 2000: underperformance, a reflection of residual small-cap risk
• Dow Jones Industrial Average: inched higher, driven by advances for financials and industrials.
• While Nvidia led the charge, the rest of the "Magnificent 7" still endure valuation anxiety. Alphabet, Amazon, and Apple lag behind overall S&P 500, which is the clear indication of a market that still depends on selective genius more than widespread engagement. S&P is stuck, supported by techs, defensives, but subject to profit-taking of utterly stretched names.

While Nvidia led the charge, the rest of the "Magnificent 7" still endure valuation anxiety. Alphabet, Amazon, and Apple lag behind overall S&P 500, which is the clear indication of a market that still depends on selective genius more than widespread engagement. S&P is stuck, supported by techs, defensives, but subject to profit-taking of utterly stretched names.

Drivers Behind the Market Move

Markets are grappling with a critical intersection of big forces impacting investment sentiment. These are the top three catalysts that are shaping U.S. and Europe equities today:

1. Inflation Signs & Fed Interest Rate Forecast

Tuesday morning's CPI report revealed a 0.3% monthly gain and 2.7% annualized rise, reinforcing anew that inflation is sticky and dashing near-term rate-cut prospects at the Fed. As market minds now turn to today's PPI and Core PPI reports, a favorable upside surprise would again put the breaks on rate-cut chances. Already, markets have taken easing prospects that were previously expected for this year from 50 to 43 basis points, a move that is deflating equities, most notably the rate-sensitive ones, and buoying the U.S. dollar on major pairs.

2. Tariff tensions and volatility in trade policy 

President Trump's recent introduction of a 35% tariff on Canadian imports, and subsequent threat of introduction of similar tariffs for Mexican and European imports, has reinstated trade policy uncertainty. In initial subdued market responses, we see a growing unease that such a development can start being reflected through readings of inflation through subsequent increases in import prices, particularly on consumables and industrial inputs. This newillas re-emergence of risk implied from tariffs is leading to defensives, safe heavens, but a drift away from cyclical sectors, exporters, and multinational companies that benefit from cross-border supply value chains.

3. Bank Reports & Earnings Season in Focus

News today from Bank of America, Goldman Sachs, Morgan Stanley, and Johnson & Johnson are the key to direction in the market. While JPMorgan Chase and Citigroup, naturally, outran estimates yesterday, mixed messages from Wells Fargo and BlackRock, in the meantime, have kept investors on their toes. As long as inflation is a dark cloud that hangs over the macro backdrop, investors want some clarity regarding whether core bank fundamentals—loan growth, trading revenue, and net interest margins—can support valuation or whether stress from cost, in addition to policy changes, will put a squeeze on profitability through the second half of the year. 

Overall, the markets are being influenced by the persistence of inflation, uncertain earnings visibility, and uncertain trade policy. All these are leaving futures lower and keeping volatility high, with investors looking to today's blockbuster corporate announcements and readings of the PPI for a direction.