S&P 500 to Sustain Rally for 5th Straight Session? Futures Suggest So

The S&P 500 index might continue its rally for the 5th consecutive session as geopolitical tensions ease. Futures on Wall Street pointed to a strong opening on the final trading day of the week. The S&P 500 futures surged over 20 points. So far this week, the index has increased over 110 points or around 2%.

Investor sentiment took a breather after geopolitical tensions eased. The US and China have reduced the reciprocal tariffs on each other's imports. As per the new agreement, the US has lowered its tariffs on Chinese imports from 145% to 30%, whereas China has dropped the rates from 125% to 10% on the US imports.

Trump has already said that he would set tariff rates for US trading partners “over the next two to three weeks,” adding that his administration lacks the capacity to negotiate deals with all its trading partners. He also said that US Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick “will be sending letters out essentially telling people” what “they will be paying to do business in the United States.”

“I think we’re going to be very fair. But it’s not possible to meet the number of people that want to see us,” POTUS said recently.

His easing tone on tariff rates has revived the overall investor optimism on Wall Street. However, the Federal Reserve Chairman's recent comments on interest rates might result in some turbulence.

Interest Rates Might Remain High

On Thursday, the Federal Reserve chairman said that the interest rates might remain high in the coming period. This might spoil the bearish mood on D-street. “Higher real rates may also reflect the possibility that inflation could be more volatile going forward than in the inter-crisis period of the 2010s,” Powell said.

“We may be entering a period of more frequent, and potentially more persistent, supply shocks — a difficult challenge for the economy and for central banks," he said.