U.S. stock futures are sharply higher ahead of the Wall Street open as a wave of optimistic relief swept through markets after the Trump administration provided some much needed easing of tensions. President Trump walked back recent commentary that he plans to fire Federal Reserve Chair Jerome Powell, which has yields falling and ‘Risk-On’ sentiment taking hold in equities. Optimism around easing US-China trade tensions added to the risk-on mood.

Tesla (TSLA) shares are rallying despite a dismal earnings report after CEO Elon Musk said he will pull back from his work with the U.S. government to focus on the electric-vehicle maker. Focus today will remain on tariff headlines along with a ramp in earnings.

• Oil (/CL) –Oil prices are up 1% near $64.30 a barrel and are extending a better than 2% gain from Tuesday. Hopes that the U.S. will be aiming to reduce trade tensions by quickly striking deals and hints that the impasse with China shouldn't last have helped to stabilize overall sentiment and support demand expectations. At the same time, U.S. sanctions and a sharp drop in crude stockpiles are keeping a lid on supply prospects. Industry data suggests that U.S. crude inventories fell by 4.6 million barrels last week. If confirmed by official data today, it would be the largest draw since November. API reports that crude inventories fell 4.57M barrels last week. Gasoline inventories fell 2.18M barrels.

• Gold (/GC) – Gold prices are down over 2% near $3340 as U.S. President Donald Trump retracted his threats to dismiss Federal Reserve Chair Jerome Powell and expressed optimism for a trade deal with China, denting bullion’s safe-haven appeal. Gold hit an all-time high just yesterday but is now down over 4% from those highs over the last 24 hours.

• Bitcoin (/BTC) – The crypto future is up over 2% near $94K in the premarket.

• VIX – The CBOE Volatility Index was down 9.6% on Tuesday and settled at 30.57 as stocks rallied. The ‘Uncertainty Index’ is down another 8% in the premarket and is at its lowest level in 3 weeks near 28.

• U.S. Dollar (/DX) – The dollar is flat near 98.9.

• Redburn Atlantic upgrades American Express (AXP) to Neutral from Sell

• Morgan Stanley upgrades RTX (RTX) to Overweight from Equal Weight

• Baird upgrades Lockheed Martin (LMT) to Outperform from Neutral

• Piper Sandler downgrades Oracle (ORCL) to Neutral from Overweight

• Barclays downgrades Chevron (CVX) to Equal Weight from Overweight

• Citi downgrades Texas Roadhouse (TXRH) to Neutral from Buy

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