(For a Reuters live blog on U.S., UK and European stock

markets, click or type LIVE/ in a news window.)

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Futures down: Dow 1.48%, S&P 500 1.98%, Nasdaq 2.45%

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GM, Ford downgraded by brokerages UBS, Goldman Sachs

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Capri Holding rises after Prada agrees to buy Versace

(Updates before markets open)

By Shashwat Chauhan and Purvi Agarwal

April 10 (Reuters) - Wall Street's main indexes were set

to open lower on Thursday, coming off a blistering rally

following U.S. President Donald Trump's move to temporarily

lower the heavy tariffs on dozens of countries.

The U-turn came less than 24 hours after steep new tariffs

took effect on most trading partners, lifting the S&P 500

to its biggest single-day percentage gain since 2008. The Nasdaq

posted its biggest one-day jump since 2001.

Trump also announced a 90-day pause on many of his new

reciprocal tariffs, but raised them to 125% on Chinese imports

from 104% on Wednesday. Beijing had slapped 84% tariffs on U.S.

imports to match Trump's earlier levy.

"The trade war is now turning into a direct confrontation

between the U.S. and China...," Rabobank analysts said. "We

could again be seeing escalation and de-escalation at the same

time, pulling markets in different directions."

The European Union said it had agreed on a 90-day pause on

counter tariffs on U.S. goods, which were due on April 15.

Futures came off their session lows after data showed the

consumer price index unexpectedly dipped 0.1% in March and

advanced 2.4% in the 12 months through March.

Economists polled by Reuters had forecast the CPI to rise

0.1% for the month and climb 2.6% year-on-year.

"(The CPI data) increases the chances that the Fed can cut

rates at some point, either due to the tariffs or due to the

jobs market, because inflation's coming down," said Larry

Tentarelli, chief technical strategist at Blue Chip Daily Trend

Report.

Traders now see nearly 90 basis points of interest-rate cuts

in 2025, according to LSEG data.

At 08:43 a.m. ET, Dow E-minis were down 606 points,

or 1.48%, S&P 500 E-minis were down 108.75 points, or

1.98% and Nasdaq 100 E-minis were down 472.25 points, or

2.45%.

Despite Wednesday's surge, the S&P 500 and the Dow

are about 4% below levels seen before the reciprocal tariffs

were announced last week.

Most megacap and growth stocks slid in premarket trade after

recording robust gains in the last session, with Tesla

and Nvidia ( NVDA ) down more than 3% each.

Meanwhile, U.S. bonds markets were sanguine after a sharp

selloff in the last session, with the yield on the 10-year note

dropping to 4.315% from its February peaks.

The CBOE Volatility Index - seen as Wall Street's

"fear gauge" - fell from its August highs and was last at 37.17

points.

Among individual shares, automakers General Motors ( GM )

and Ford fell about 4% each after the previous session's

gains. Downgrades from UBS and Goldman Sachs on the stocks added

to their declines.

Capri Holdings ( CPRI ) jumped 5.3% after Prada

said it has struck a deal to buy smaller rival Versace from the

Michael Kors-parent. The deal has an enterprise value of $1.375

billion.

Investors will keep a close watch on comments from at least

six Fed officials who are also set to make public appearances

throughout the day.

U.S. earnings season could also offer more insights into the

health of corporate America. Big banks such as JPMorgan Chase ( JPM )

will report first-quarter results on Friday.