What’s Driving the Markets Today

Futures linked to major U.S. indices are searching for direction. On Wall Street, attention is focused on a series of corporate earnings reports and the Federal Reserve’s decision on interest rates, as well as a potential federal government shutdown following deadly events in Minnesota. Against this backdrop, gold is trading near record highs, while oil prices are giving back some recent gains.

1. Futures are Mixed

U.S. index futures traded near the flatline on Tuesday as traders prepare for multiple corporate earnings reports and the upcoming Federal Reserve interest rate decision.

As of 03:27 ET (08:27 GMT), Dow futures were down 31 points (-0.1%), S&P 500 futures were up 20 points (+0.3%), and Nasdaq 100 futures gained 146 points (+0.6%).

Major indices rose in the previous session, with the S&P 500 and the tech-heavy Nasdaq Composite marking a fourth consecutive gain. Both indices reached their highest levels in over a week and currently have the longest streak of positive sessions since December.

The increase was driven by mega-cap tech companies, including Apple, Microsoft, and Meta, which are expected to report quarterly results later this week.

Markets are also gearing up for the Fed’s announcement on Wednesday. According to CME FedWatch, the central bank is expected to leave borrowing costs unchanged following the last two-day meeting, supported by signs of relative strength in the U.S. economy. Wall Street is also watching whom President Donald Trump will nominate as Fed Chair after Jerome Powell’s term expires in May.

2. Focus on Government Shutdown Risks After Trump’s Minnesota Pivot

However, the risk of a federal government shutdown loomed early in the week after another deadly shooting in Minneapolis triggered a legislative deadlock in Washington.

Following the House of Representatives’ passage of a series of federal funding bills last week, the Senate was expected to approve them as well. Democrats in the upper chamber were particularly seen as motivated to avoid a damaging government shutdown after last year’s record-long closure.

But the events in Minneapolis, especially the death of a 37-year-old man at the hands of a Border Patrol agent, prompted Democrats to call for new restrictions and oversight on the Department of Homeland Security—one of the agencies central to the Trump administration’s immigration policy.

Critically, despite their Senate majority, Trump’s Republican Party needs support from Democratic senators to avoid another funding shutdown.

With a January 31 deadline to sign the funding package, the president appears to be attempting to ease tensions with what he described as a “very good” phone call with Minnesota Governor Tim Walz. Border Patrol Chief Gregory Bovino will also leave the state, media reported, citing administration officials.

“Whether a compromise will be reached to avoid a partial shutdown on February 2 remains to be seen, but investors are not particularly concerned about the matter at this time,” analysts from Vital Knowledge commented.

3. Expected Earnings

Attention is again turning to the state of corporate America and the series of earnings reports set to be released over the coming days.

While large tech companies are likely to dominate the headlines, key reports from UnitedHealth Group, RTX Corporation, Boeing, General Motors, and United Parcel Service will be published on Tuesday before the market opens.

Recent data indicate that the U.S. economy is taking a “K-shaped” trajectory, where high-income households and corporations form the bulk of activity, while lower-income households face high living costs and a weak labor market. The first reporting season of 2026 could reveal whether this trend will continue throughout the year.

4. Gold Holds Near Record Highs

Gold prices rose on Tuesday after reaching a series of record levels amid concerns over Trump’s trade policies and heightened global geopolitical tensions.

Expectations for the Fed decision also keep the market more risk-averse.

Spot gold rose 1.4% to $5,079.73 per ounce, while April futures fell 0.2% to $5,115.19/oz. On Monday, spot gold reached a historic high of $5,111.11/oz.

Other precious metals also advanced. Spot silver rose nearly 4% to $107.9350/oz after a record above $111/oz, and spot platinum jumped 2.7% to $2,656.27/oz.

Amid the threat of a trade embargo on Canada, Trump announced Monday evening that he would raise tariffs on South Korean goods to 25%, claiming that Seoul is delaying the implementation of a recent trade agreement.

While Trump disrupts global trade, other countries are seeking alternatives. On Tuesday, India and the European Union signed a free trade agreement covering 25% of global GDP and one-third of international trade. Trade between India and the EU totaled $136.5 billion in the financial year through March 2025. Together, they account for nearly one-fifth of global trade and about 25% of the world’s population.

5. Oil Prices Slip Slightly

Oil prices edged lower, giving back some recent gains, though losses were limited due to supply disruptions caused by extreme winter conditions in the U.S.

Brent futures fell 0.5% to $64.46 per barrel, while WTI futures dropped 0.4% to $60.38 per barrel.

Both benchmarks posted weekly gains of 2.7% last week, closing Friday at their highest levels since January 14.

The decline in oil prices was offset by production losses in the U.S., as a strong winter storm swept across the country, straining energy infrastructure and power grids.

It is estimated that U.S. producers lost up to 2 million barrels per day, or roughly 15% of national production, over the weekend.