US STOCKS-Wall St set to jump as Trump says he has no plans to fire Powell; Tesla leaps

By Lisa Pauline Mattackal and Purvi Agarwal

April 23 (Reuters) - U.S. stock index futures pointed to a sharply higher open on Wednesday after President Donald Trump dialed back on his threats to fire Federal Reserve Chair Jerome Powell and raised hopes for a trade deal with China.

Corporate earnings were also in focus, with shares of Tesla TSLA.O jumping 7.2% in premarket trading.

The EV-maker reported a profit for its core auto business that topped rock-bottom expectations, while CEO Elon Musk said he would step back from his involvement in the Trump administration to focus on running his numerous companies.

Trump said on Tuesday he had "no intention" of firing Powell, backpedaling after his comment that the Fed chair's termination could not come "fast enough" drew heavy criticism.

Markets welcomed the change in the president's tone. Trump's criticism of Powell had fueled concerns about the central bank's autonomy, leading to sharp losses in U.S. assets including stocks and the dollar earlier in the week.

Meanwhile, hopes for negotiations between the U.S. and China, which have been locked in an escalating tit-for-tat tariff war, also helped lift sentiment after Trump expressed optimism that a trade deal with Beijing could "substantially" lower tariffs on Chinese goods.

The comments on tariffs and backtracking on threats against Powell "set the stage" for the day's equity rally, said Leslie Thompson, CIO at Spectrum Wealth Management.

"We're going in between upside and downside exhaustion in the market, but certainly it's trading on headlines."

At 08:40 a.m. ET, Dow E-minis 1YMcv1 were up 767 points, or 1.95%, S&P 500 E-minis EScv1 were up 134.75 points, or 2.54%, and Nasdaq 100 E-minis NQcv1 were up 561.75 points, or 3.06%.

Megacap tech stocks rose broadly, with Nvidia NVDA.O gaining 5.36%. Apple AAPL.O and Meta Platforms META.O rose 3.4% and 5.5%, respectively, despite being fined for breaching European Union law.

The U.S. president also said he wanted the central bank to be more active in lowering interest rates.

Trump's criticism of Powell had hit markets already battered by his erratic trade policies, with the S&P 500 .SPX down nearly 14% from its February record high. Federal Reserve policymakers have reiterated caution in easing policy, given the lack of clarity on the impact of his trade policies.

While the current rally seems sustainable, "the market is going to trade between a range until we get more certainty", Thompson said.

Investors will parse company results for further clues on the impact of tariffs on earnings and consumer behavior.

Boeing BA.N gained 5.5% after its quarterly results, while Boston Scientific BSX.N gained 7.8% after topping revenue and profit estimates in the first quarter.

Intel INTC.O rose 5.6% after a report said the chipmaker was set to cut over 20% of its workforce.

S&P Global PMI surveys expected on the day will be watched to see how businesses cope with tariffs. Comments from four Fed speakers are also on deck.