US stock market futures experienced a slight pullback on Tuesday, July 1, 2025, after major indices like the S&P 500 and Nasdaq Composite had achieved new record closing highs on Monday. While the S&P 500 and Nasdaq saw minor declines of 0.22% and 0.27% respectively in futures trading, the Dow Jones Industrial Average showed resilience, rising by approximately 0.6% during the day. This comes after a robust second quarter, where the S&P 500 gained over 11% and the Nasdaq surged 17%, driven by strong economic data, corporate earnings, and receding tariff concerns.

Several key factors are currently shaping Wall Street's cautious mood. Foremost among them is the progress of President Donald Trump’s extensive tax and spending bill, dubbed the “One Big Beautiful Bill,” which is under intense debate in the Senate. The administration aims to sign this legislation into law by July 4, with implications for corporate and individual tax cuts, increased spending on areas like border security and defense, and controversial cuts to healthcare and food support programs. Notably, a significant bipartisan amendment passed, removing the federal ban on state-level AI regulation, a move with potential ramifications for large tech firms.

Another critical element is the Federal Reserve’s monetary policy, with investors closely monitoring economic data for clues on potential interest rate cuts. All eyes are on Thursday's jobs report, as signs of a cooling labor market could accelerate the Fed's decision-making process. Fed Chair Jerome Powell, while speaking at an ECB forum, maintained a cautious stance, acknowledging that existing tariffs are influencing the central bank's