Dow Jones futures rose slightly early Wednesday, along with S&P 500 futures and Nasdaq futures. The Federal Reserve meeting decision looms with policymakers seen curbing rate-cut forecasts.
The stock market rally retreated Tuesday and crude oil jumped as President Donald Trump called for Iran's "unconditional surrender," amid reports that the U.S. joining Israel's attacks is "on the table."
Tesla fell amid negative headlines about the EV business ahead of the planned robotaxi launch.
Many solar stocks dived, including Sunrun, SolarEdge Technologies and First Solar.
The video embedded in the article reviews Tuesday's market action, previews the Federal Reserve meeting and analyzes Cisco Systems, Astera Labs and Nintendo.
Dow Jones Futures Today
Dow Jones futures rose 0.1% vs. fair value. S&P 500 futures climbed 0.15% and Nasdaq 100 futures advanced 0.2%.
The 10-year Treasury yield dipped to 4.37%.
Remember that overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session.
Fed Meeting: Watch The 'Dot Plot'
The Federal Reserve's two-day meeting ends Wednesday, with the central bank set to stand pat at 2 p.m. ET. But the Fed's quarterly economic projections, policymakers' "dot plot" and Fed chief Jerome Powell's 2:30 p.m. ET press conference will give clues about future moves.
Fed policymakers may downshift forecasts to just one rate cut in 2025 vs. two cuts seen in March. Trump tariffs and the Israel-Iran conflict raise uncertainty despite signs of a weakening economy and relatively tame inflation.
Trump Mulls Joining Iran Attacks
Trump early Tuesday called for Iran's "unconditional surrender" and said that "we" have control over Iran's airspace.
Trump held a national security meeting in the White House Situation Room on Tuesday. According to multiple reports, he was considering a potential U.S. airstrike on Iran. U.S. bunker-busters delivered by B-2 bombers are likely the only way to destroy Iran's deepest nuclear enrichment site at Fordow.
However, Trump could be trying to maximize Iran concessions.
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Stock Market Rally
The stock market rally retreated Tuesday amid the Iran-Israel conflict and Trump's next move.
The Dow Jones Industrial Average fell 0.7% in Tuesday's stock market trading. The S&P 500 index declined 0.8%. The Nasdaq composite gave up 0.9%. The small-cap Russell 2000 retreated 1%.
The Dow Jones fell back below the 200-day line while the S&P 500 and Nasdaq have paused for the past few sessions, not far from record highs.
Solar stocks were big losers. Sunrun stock crashed 40% and SolarEdge dived 33.4%. First Solar stock plunged 17.9%. The GOP-led Senate Finance Committee's version of the Trump budget bill — like the House-passed legislation — would wind down solar and wind incentives by 2028.
The 10-year Treasury yield fell six basis points to 4.39%. Crude prices jumped 4.3% to $74.84 a barrel, up 23.1% so far in June.
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ETFs
Among growth ETFs, the Innovator IBD 50 ETF fell 1.4%. The iShares Expanded Tech-Software Sector ETF and VanEck Vectors Semiconductor ETF dropped 0.7%. The ARK Innovation ETF retreated 1.6%. Tesla stock is the No. 1 holding across Ark Invest's ETFs.
SPDR S&P Metals & Mining ETF climbed 0.8%. The Energy Select SPDR ETF advanced 0.9% and the Health Care Select Sector SPDR Fund stepped down 1.65%.
The Industrial Select Sector SPDR Fund declined 0.7%. The Financial Select SPDR ETF shed 0.75%.
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Tesla Stock Falls
Tesla stock fell 3.9% to 316.28, back below the 21-day line and approaching the 200-day.
The limited Tesla robotaxi launch in Austin, Texas, is still set for Sunday, but could shift.
Tesla China EV registrations jumped last week, but second-quarter sales in that key market are still slightly below the seasonally slow Q1.
Tesla Austin will shut down Model Y and Cybertruck production for the 4th of July week, Business Insider reported Tuesday. That would follow a Memorial Day week shutdown
Q2 global deliveries are on pace for a 21% year-over-year decline, Wells Fargo said. That would be roughly 350,000, far below consensus. Wells, which has a sell rating on TSLA stock, says the EV giant could report negative free cash flow for the first time since 2018.
Also, the Senate version of the Trump tax bill would follow the House's lead and eliminate the $7,500 EV tax credit, along with other moves that could affect Tesla's businesses.
Tesla Robotaxi Launch Looms; BYD Undercuts Support
What To Do Now
The stock market rally continues to trend higher, refusing to sell off amid potentially negative news and a lot of uncertainty. So it's still a time to be heavily or fully invested.
Several stocks are setting up. Investors can look to add new buys, either adding exposure or replacing laggards. But largely standing pat makes sense.
The Israel-Iran conflict, especially Trump's next moves, has the potential for major market swings.
The Federal Reserve meeting and Fed chief Powell will be in focus Wednesday. With Thursday's market holiday, U.S. investors may not get a full market reaction until Friday.
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