U.S. stock index futures were down on Tuesday, pulling back after a sharp rally fueled by a U.S.-China trade truce, as investors turned their focus to a key U.S. inflation reading that could shape the outlook for monetary policy.

Wall Street was on track to open with losses as the initial euphoria over the 90-day truce in the U.S.-China trade war faded.

Stocks traded mixed and the dollar dipped on Tuesday as the rally from the previous day faded despite cool US inflation data easing concerns about the economy.

U.S. futures surged after the U.S. and China announced they were suspending for 90 days most of the sharp tariff hikes each has imposed since U.S. President Donald Trump began escalating his trade war

The negotiations mark a significant de-escalation in Trump’s global tariff offensive, which had sent US stocks tumbling as much as 15 per cent following Trump’s “liberation day” announcement. Trump had paused most of the so-called reciprocal tariffs a week after they were announced,

US stocks surged on Monday after President Donald Trump’s top trade officials brokered a surprisingly dramatic de-escalation in trade tensions with China over the weekend, dropping tariffs to much lower levels,