Stock Market Update: Futures Dip as Tesla Slides, Trump and Musk Feud Over Subsidies
U.S. stock futures fell on Tuesday, marking a weak start to the second half of 2025, after the S&P 500 wrapped up Q2 with record highs. Investors are bracing for heightened volatility amid trade tensions, political developments, and fresh economic data.
Futures Snapshot (as of Tuesday morning ET):
- Dow Jones futures: -98 points (-0.2%)
- S&P 500 futures: -0.4%
- Nasdaq-100 futures: -0.6%
Tesla Tumbles in Premarket After Trump Targets Subsidies
Shares of Tesla fell in premarket trading after President Donald Trump suggested the newly formed Department of Government Efficiency (DOGE) investigate the government subsidies received by Elon Musk’s companies.
The move follows a heated exchange over the weekend, with Musk calling Trump’s “big, beautiful bill” “utterly insane and destructive.” In response to Trump’s latest post, Musk wrote on X (formerly Twitter): “I am literally saying CUT IT ALL. Now.”
This ongoing feud has already rattled markets once this year, with Trump threatening to cut federal contracts for Musk’s businesses in June, calling the Tesla CEO “CRAZY.”
Monday Recap: Record Highs Despite Global Trade Friction
- S&P 500: +0.5% (New all-time high)
- Nasdaq Composite: +0.5% (New all-time high)
- Dow Jones: +275.50 points (+0.6%)
Markets were buoyed Monday by Canada’s decision to withdraw its digital services tax, a move seen as an attempt to salvage trade negotiations with the U.S. President Trump had previously said he would be “terminating ALL trade talks” with Ottawa.
Investors are keeping a close eye on the July 9 tariff deadline, as Trump’s 90-day reprieve on steepest tariffs nears expiration. A potential resolution could ease fears of another global trade shock.
Fed Policy & Economic Data in Focus
Traders await Fed Chair Jerome Powell’s remarks at 9:30 a.m. ET at the ECB’s Central Banking Forum in Portugal. Powell previously signaled the Fed would remain on hold until there’s clearer evidence on how tariffs impact inflation.
Key data releases today:
- S&P Global Manufacturing PMI (9:45 a.m. ET)
- ISM Manufacturing Report (10:00 a.m. ET)
- JOLTS (Job Openings and Labor Turnover Survey)
Despite the futures dip, analysts remain cautiously optimistic. Morgan Stanley’s Mike Wilson noted on CNBC that a “broader recovery” could unfold later this year, especially in rate-sensitive sectors like housing and manufacturing.
“With the Fed likely cutting in late 2025 or early 2026, there’s a lot of pent-up demand ready to be unleashed,” Wilson said.
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