Markets Rattled by Trade Talks, Fed Decision Looms

U.S. stock futures saw an uptick on Wednesday in anticipation of an upcoming meeting between top U.S. and Chinese trade officials, although Asian markets showed restraint as the chances for a tariff agreement remained uncertain. Scheduled for the weekend in Switzerland, the meeting is anticipated to focus on de-escalating tensions, according to U.S. Treasury Secretary Scott Bessent.

Despite early gains, Hong Kong's Hang Seng index and S&P 500 futures moderated through the Asia session, while Japanese and Chinese markets displayed modest changes. The trade tensions spurred support for the dollar, especially as the Federal Reserve meeting approached, with analysts expecting no immediate rate cuts. The dollar's recent volatility stems from geopolitical influences and juxtaposed economic data.

European and Asian markets also adjusted, with Germany's BMW confirming its optimistic 2025 outlook amid expectations of declining tariffs. Meanwhile, geopolitical tensions between nuclear powers Pakistan and India introduced further market variability, as eyes remain trained on the U.S.-China trade negotiations and Federal Reserve's monetary policy decisions.

(With inputs from agencies.)