Top 4 things you need to know about the market on Tuesday

1. U.S. stocks simmer at record highs

After the S&P 500 closed yesterday at record highs thanks to the agreement to restart U.S.-China trade talks, buying enthusiasm ran out of steam on Tuesday with U.S. futures pointing to a slightly lower open. U.S. futures pointed to a triple-digit gain in the Dow at the open, adding to a rally in June that was its best since 1938. Dow futures dipped 31 points, or 0.1%, S&P 500 futures slipped 3 points, or 0.1%, while Nasdaq 100 futures dropped 16 points, or 0.2%.

2. U.S. proposes tariffs on $4 billion worth of EU goods

The U.S. added more products from the European Union to a list of goods it could hit with retaliatory tariffs in a long-running trans-Atlantic aircraft subsidy dispute between Boeing and Airbus. The list of $4 billion worth of EU goods includes olives, Italian cheese and Scotch whiskey.

The World Trade Organization had ruled that the EU subsidies to Airbus violate international trade rules and is expected to decide this summer on the amount of countermeasures the U.S. can impose. The U.S. claims the subsidies cause $11 billion worth of damage to the U.S. economy.

3. Oil drops ahead of production cut rubber stamp, U.S. inventories

Oil prices moved lower on Tuesday as markets awaited the final approval on the decision by OPEC and its allies, known as OPEC+, to extend their production cut agreement for another nine months.

With expectations for the deal to go through without a hitch, market focus will shift to weekly U.S. inventory data amid forecasts for a third straight draw in stockpiles.

The American Petroleum Institute will report its data on stockpiles ahead of official government data out Wednesday.

U.S. crude oil futures fell 21 cents, or 0.4%, to $58.88 by 5:31 AM ET (9:31 GMT), while Brent oil traded down 17 cents, or 0.3%, to $64.89.

4. Australia cuts rates to record low

The Reserve Bank of Australia cut interest rates to a record low of 1% overnight in the latest round of central bank easing that has taken hold amid fears of trade uncertainty. RBA Governor Philip Lowe explained that the move was designed to support employment and help inflation move towards the bank’s target.

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