Dow Jones & Nasdaq 100 Waver on US-China Trade Tensions

US-China Trade Headlines Hit Market Sentiment Ahead of APEC Summit

US stock futures faced an uneasy Asian morning session on Thursday, October 23, as President Trump turned up the heat on Beijing ahead of the APEC Summit.

The US administration reportedly made plans to curb exports of global US software-powered goods to China. Trump’s focus on restricting critical software exports followed his recent threat of raising tariffs on Chinese goods to 155%, effective November 1.

US stock futures wavered on the news, while Mainland China’s CSI 300 and the Shanghai Composite were down 0.55% and 0.64%, respectively, in morning trading.

However, Mainland equity markets avoided heavy losses amid optimism over President Trump and President Xi Jinping reaching a trade deal at the October 31-November 1 APEC Summit.

US Stock Futures Mixed

Trump’s latest move to restrict China’s access to US tech clashed with market bets on Fed rate cuts in October and December.

The Dow Jones E-mini dropped 2 points in early trading on Thursday, October 23. Meanwhile, the Nasdaq 100 E-mini and the S&P 500 E-mini rose 64 points and 12 points, respectively. A more dovish Fed rate path would lower borrowing costs, potentially boosting earnings for capital-intensive tech firms.

According to the CME FedWatch Tool, the chances of a 25-basis point Fed rate cut in October stand at 96.7%, with a 96.7% chance of a December cut.

Markets are betting on back-to-back Fed rate cuts amid the prolonged US government shutdown. The Senate stalemate has delayed key economic reports, such as the jobs report, supporting a more dovish Fed policy stance.

US-China Trade Tensions, Earnings, and Capitol Hill in Focus

Across the Pacific, further threats from Washington or responses from Beijing could weigh on US stock futures.

With no key US economic indicators due, developments on Capitol Hill will be in focus.

A Senate vote passing a stopgap funding bill could expedite the release of economic indicators ahead of the Fed’s interest rate decision on October 29. The prospect of labor market and inflation data may fuel market uncertainty.

On the other hand, a prolonged shutdown may support more aggressive Fed rate cuts, lifting sentiment.

For context, the 2018-2019 shutdown shaved around 0.4% of the US GDP. Fast forward to 2025, and labor market indicators had already signaled deteriorating conditions ahead of the shutdown.

Key Technical Levels for Dow Jones, Nasdaq 100, and S&P 500

Despite mixed early moves, US stock futures held above key technical levels, signaling underlying bullish momentum.

However, the near-term trends hinge on US-China trade news, corporate earnings, and the US Senate vote. Key levels traders should monitor include:

Dow Jones

• Resistance: 47,000, the October 21 record high of 47,334, then 47,500.
• Support: 46,750, 46,500, the 50-day EMA (46,041).

Nasdaq 100

• Resistance: 25,250, October 9 record high of 25,394, then 25,500.
• Support: 25,000, 24,500, the 50-day EMA (24,428).

S&P 500

• Resistance: 6,750, October 9 record high of 6,812, then 7,000.
• Support: the 50-day EMA (6,618) and 6,500.

Market Outlook: Trade Headlines, Earnings, and Capitol Hill in the Spotlight

Markets may remain volatile as investors weigh escalating trade risks against Fed policy expectations.

The latest escalation in the US-China trade war will keep markets wary ahead of the APEC Summit. Given Trump’s latest threats, a further escalation is possible as Washington and Beijing look to gain the upper hand before a Trump-Xi meeting.

Meanwhile, corporate earnings and developments on Capitol Hill will continue influencing US stock futures.

Follow our live coverage and consult the economic calendar for real-time market updates.