Investing.com - U.S. stock futures moved up on Tuesday, with all eyes on possibly historic talks between U.S. and Russian officials on ending the war in Ukraine. But as representatives from both countries meet in Saudi Arabia, Ukraine and its European allies have noted worries that they have been kept out of the discussions. Elsewhere, a Delta Air Lines (NYSE:DAL) regional plane flips upside down on the runway at Toronto Pearson Airport amid windy conditions, while the Reserve Bank of Australia cuts interest rates for the first time since the height of the 2020 COVID-19 pandemic.
1. Futures higher
U.S. stock futures ticked higher on Tuesday, as investors returned for a holiday-shortened trading week with the talks between the U.S. and Russia aimed at ending the war in Ukraine in the limelight.
By 03:26 ET (08:26 GMT), the Dow futures contract had added 64 points or 0.2%, S&P 500 futures had edged higher by 18 points or 0.3%, and Nasdaq 100 futures had gained 91 points or 0.4%.
The main averages on Wall Street were closed on Monday in observance of the Presidents Day holiday.
Futures in Europe were hovering near record high levels, bolstered in particular by defense stocks. European leaders have said they would bump up military spending and become the main guarantor of Ukraine’s security, with analysts noting signals from the Trump administration that the U.S. may no longer be relied upon to backstop the continent’s defense.
Shares in Hong Kong also climbed to almost three-year highs as traders eyed a rare meeting between Chinese President Xi Jinping and domestic business leaders.
2. U.S.-Russia talks in Saudi Arabia
Officials from the U.S. and Russia are holding crucial negotiations in Saudi Arabia on a potential deal to halt the war in Ukraine.
The discussions mark a possible thawing in relations between Washington and Moscow that have been all but frozen since the onset of the conflict in early 2022. U.S. Secretary of State Marco Rubio, White House national security advisor Mike Waltz, and Middle East envoy Steve Witkoff are representing U.S. President Donald Trump, while Russian Foreign Minister Sergei Lavrov and a Kremlin foreign policy advisor will represent Russian President Vladimir Putin.
However, neither Ukraine nor its European allies were invited to participate in the discussions. Kyiv has stated that no peace deal can be secured on its behalf.
Media reports have suggested that the gathering could serve as a precursor to a face-to-face meeting between Trump and Putin. Trump surprised traditional U.S. allies in Europe last week when he announced that he had spoken with Putin by phone and had ordered his team to kick-start peace talks.
European leaders met in Paris earlier this week to discuss how they would provide a unified response to Trump’s actions.
"Support for more defence spending is growing in Europe as the U.S. takes a step back," analysts at ING said in a note to clients. They argued that joint European borrowing, which France has previously suggested may be a possible strategy for funding continent-wide security, "could be a way forward."
3. Delta plane flips upside down landing at Toronto airport
A regional Delta Air Lines plane flipped upside down after landing at Toronto Pearson Airport on Monday, leaving 18 of the 80 people on board injured.
Officials said that three of the people on the flight from Minneapolis-St. Paul International Airport had suffered critical injuries and a further 15 were taken immediately to the hospital, Reuters reported. Some of those who had been hospitalized have been released, the news service added.
Delta said that there were 76 passengers and four crew members on board the CRJ900 aircraft, which was operated by the carrier’s Endeavor Air division. The jet was produced by Canada’s Bombardier (TSX:BBDb) (OTC:BDRBF) and powered by GE Aerospace (NYSE:GE) engines.
Authorities in Canada have said they would investigate the incident, but noted that its cause was not immediately known. Shares in Delta were little changed in extended hours trading on Tuesday.
4. RBA cuts rates
The Reserve Bank of Australia has slashed interest rates for the first time in four years, although policymakers flagged that it remains too early to declare victory over inflation and further cuts are not guaranteed.
In particular, officials at Australia’s central bank warned that rolling out a series of quick reductions could cause a recent disinflationary trend in the country to stall.
Following the quarter-point cut in the RBA’s key cash rate to 4.1%, markets are now pricing in two more drawdowns in 2025. But, speaking in a news conference, RBA Governor Michele Bullock flagged that the decision does not imply that "future rate cuts along the lines suggested by the market are coming."
Unlike many of its global peers, the RBA has been relatively slow to announce cuts to borrowing costs, choosing instead to keep rates steady for more than a year in a bid to progressively slow price growth. Tuesday’s cut also comes after the Federal Reserve pushed pause on its own easing cycle last month and signaled it would take a wait-and-see approach to further reductions in the months ahead.
5. Oil advances
Brent crude prices rose on Tuesday, extending gains logged in the prior session, after a drone attack on an oil pipeline in Russia dented supply flows from Kazakhstan.
A senior Russian official claimed that the pipeline was struck by Ukrainian drones and is responsible for pumping around 1% of global oil supply. The official flagged that the attack may disrupt supplies and impact U.S. businesses.
However, the prospect of a Ukraine peace deal limited gains. Analysts have argued that an end to the hostilities could lead to a loosening of longstanding sanctions on Russia, reopening a raft of new oil supplies.