Stocks Down Pre-Bell as Trump Says He Fired Fed Governor Lisa Cook, Threatens More Tariffs in Digital Tax Retaliation

07:41 AM EDT, 08/26/2025 (MT Newswires) -- US equity futures were pointing lower on Tuesday after President Donald Trump said he removed Federal Reserve Governor Lisa Cook from her post and threatened more tariffs on countries that do not eliminate digital taxes and related regulations for US tech companies.

The S&P 500 and the Nasdaq edged down 0.1% each in premarket activity, while the Dow Jones Industrial Average was off 0.2%. The indexes finished Monday's trading session in the red.

Trump sent a letter, shared on Truth Social, to Cook on Monday that he had determined "sufficient cause" to remove her from the Fed's board of governors, effective immediately. Trump claimed that Cook may have made "false statements on one or more mortgage agreements."

The announcement follows threats against Cook over allegations of mortgage fraud. In response, Cook said Trump has no authority to fire her and she will not resign, according to several media reports.

The two-year Treasury yield retreated 1.9 basis points to 3.71% in premarket action, while the 10-year rate increased 2.5 basis points to 4.3%.

Last week, Fed Chair Jerome Powell hinted at a potential shift in monetary policy toward lower interest rates, saying that downside risks to employment were rising and the effects of tariff-driven inflation are likely to be short lived. Markets are currently pricing in an 84% probability that the central bank will cut its benchmark lending in September, according to the CME FedWatch tool.

In a separate social media post on Monday, Trump said he will implement "substantial additional tariffs" in retaliation against countries that impose digital taxes on US technology firms and place export restrictions on "highly protected technology" and chips.

"I will stand up to countries that attack our incredible American tech companies," Trump said. "Digital taxes, digital services legislation, and digital markets regulations are all designed to harm, or discriminate against, American technology."

Tuesday's economic calendar has the durable goods orders report for July at 8:30 am ET, followed by the Case-Shiller Home Price Index and the Federal Housing Finance Agency House Price Index, both for June, at 9 am. The Conference Board's consumer confidence report and the Richmond Fed manufacturing index, both for August, are out at 10 am.

Richmond Fed President Thomas Barkin is scheduled to speak at 8:30 am.

KE Holdings (BEKE) and Atour Lifestyle (ATAT) are expected to report their latest financial results before the bell, among others, while MongoDB (MDB) and Okta (OKTA) post earnings after the markets close.

Tech bellwether Nvidia (NVDA) is slated to release its quarterly financial statement on Wednesday. Tigress Financial Intelligence said Monday it expects the company to report record results amid robust demand for data center processors and its Blackwell generative artificial intelligence system.

Shares of Interactive Brokers (IBKR) inclined 4.2% pre-bell as the company is set to replace Walgreens Boots Alliance (WBA) in the S&P 500, effective before the opening of trading on Thursday. GoPro (GPRO) added 3% after closing Monday up 36%. Tilray Brands (TLRY) advanced 7.2% and Beyond Meat (BYND) rose 1.2%.

West Texas Intermediate crude oil dropped 1.7% to $63.70 a barrel before the opening bell. Gold was down slightly at $3,417 per troy ounce, while bitcoin decreased 0.9% to $110,357.

MT Newswires does not provide investment advice. Unauthorized reproduction is strictly prohibited.