Corporate stock market news and geopolitical events, Fed meeting and trade wars
Latest stock market news
• Yesterday, US stocks fell by an average of 0.8%. Healthcare stocks were hit. Oil rose in price and recouped all of Monday's decline. In the morning, US stock index futures are up by 0.6%.
The dollar is marking time in consolidation.
Gold tested $3,448 yesterday and is rolling back slightly this morning.
Bitcoin is up by 2.5% this morning.
• After weeks of speculation about a de-escalation in US-China relations, markets reacted cautiously to news that the two countries' top trade officials will meet in Geneva this weekend. It all sounds very tentative.
U.S. Treasury Secretary Scott Bessent told Fox News that Saturday’s meeting would focus on what to talk about. “My sense is that it will be about de-escalation,” he said. But the Chinese side was cautious, citing a proverb in a statement. “There’s an old Chinese saying: listen to what’s said and watch what’s done… if (the U.S.) says one thing and then does another, or tries to use the talks as cover for continued coercion and blackmail, China will never agree.”
However, it boosted U.S. futures, which held on to most of their gains in Asian trading, while Hong Kong shares jumped.
China also announced interest rate cuts and expanded the channel for insurers to channel funds into the stock market, which has won investor approval, albeit not much enthusiasm, as the fiscal spending they so desired remains absent.
• The moves filled the hours ahead of a Federal Reserve meeting where no policy changes are expected but markets will try to gauge policymakers' sensitivity to employment and inflation issues. Markets trimmed expectations for more cuts after data on Friday showed the labor market was holding up for now.
• The Indian rupee weakened slightly against the dollar as the worst fighting in two decades erupted between India and Pakistan. Asian currencies eased after several sessions of gains against the greenback.
• Europe is expected to release mostly second-tier data later in the day, although earnings from healthcare multinational Fresenius and drugmaker Novo Nordisk are also due.
• Bitcoin BTC is signaling growth for the S&P 500, says Tom Lee of Fundstrat/
According to him, the market is expecting a near-term recovery - the potential for growth remains. Waiting for good reports from companies.
The sharp drop in oil prices has forced hedge funds to exit oil and gas stocks en masse, the pace of the sell-off has become a record for 10 years, - Goldman Sachs/
• The stock market's "greed" in the Fear & Greed index is the first since the beginning of the year.
Vanguard forecasts that U.S. stocks will generate about 5.5% annual growth over the next 10 years.
Outside the U.S., the best CAGR is expected - more than 8%.
Goldman Sachs notes that markets outside the U.S., although cheaper compared to the U.S., are not undervalued relative to their historical valuation.
• The Fed made its largest bond purchase since 2021, more than $20 billion in 3-year notes, just a week after providing $3.5 billion in liquidity through the discount window.
• Ford (F, +2.7%) warns auto industry vulnerable to China's rare earth export restrictions - Nikkei
Just a few parts could potentially cause production disruptions, Ford's chief operating officer says.
• Uber (UBER, +0.5%) and WeRide announced a major expansion of their partnership,
bringing autonomous taxis to 15 more cities outside the U.S. and China, including Europe, within five years.
• Waymo, in partnership with Magna, plans to double robotaxi production at a new plant in Arizona by the end of 2026, - CNBC.
• The US Department of Justice is demanding that Google (GOOG) sell its AdX ad exchange and DFP server after a court ruling that it illegally monopolizes the digital advertising market.
• The number of announced buybacks in US stocks is growing rapidly - Deutsche Bank.
• DoorDash (DASH, -7.4%) is buying Britain's Deliveroo for $3.9 billion.
• Walmart+ (WMT) reached a record high of nearly 17.7 million subscribers in April (+35% y/y).
• Tesla (TSLA) has included more than 60 Chinese suppliers in its global purchasing system, - the company's vice president.
• Apollo now estimates the probability of a tariff-induced recession at 90% over the next 12 months.
• Microsoft (MSFT) unveiled two new next-generation Copilot+ laptops that can run AI models without the internet - CNBC
• The spread between the 10-year and 2-year U.S. bond yields has been positive for more than six months.
Analysts warn that historically such a sharp flattening of the curve to positive levels has often preceded recessions.
• BofA Securities said its clients bought $4.5 billion in U.S. stocks last week, marking the second straight week of inflows.
• Palantir Technologies (PLTR, -12%) received significant praise from Wall Street analysts following its latest quarterly results and guidance.
Wedbush Securities raised its price target to $140, citing confidence in Palantir's growth story and its potential to become a $1 trillion company within three years.
• Microsoft (MSFT)-backed OpenAI has agreed to acquire coding tool Windsurf for $3 billion, its largest acquisition to date.
The move is expected to strengthen OpenAI's capabilities against rivals such as Anthropic and GitHub.
• ON Semiconductor (ON, +0.3%) reported first-quarter revenue of $1.45 billion and non-GAAP EPS of $0.55, beating the average forecast.
The company is focused on its “Fab Right” initiative to reduce manufacturing capacity and improve gross margins. While automotive revenue declined 26%, the AI data center segment saw strong growth, and ON’s silicon carbide-based solutions are gaining traction in the EV market.
• Datadog (DDOG) shares rose 0.3% after its first-quarter results and revenue outlook beat expectations.
Datadog's strong performance is driven by rapid growth in the cloud security market.
• Brookfield Asset Management (BAM, +2%) reported first-quarter earnings and revenue that missed expectations.
Despite the miss, fee income rose 26% year over year. The company raised $25 billion in capital during the quarter.
• Google (GOOG), in partnership with Range Media Partners, has quietly launched a new film and TV production initiative called “100 Zeros.”
The initiative aims to support both scripted and unscripted projects. The partnership also includes a program to explore the relationship between humanity and AI through short films.
• IonQ (IONQ, -1.3%) completed the acquisition of ID Quantique, expanding its capabilities in quantum networking.
• GlobalFoundries (GFS, -3%) reported better-than-expected first-quarter results,
with revenue up 2% year-over-year to $1.59 billion,
driven by growth in automotive, communications infrastructure and industrial IoT.
• Credit Suisse to pay $510 million for hiding U.S. taxpayer assets.
Swiss international financial services group Credit Suisse Services AG has pleaded guilty to tax violations, entered into a separate plea agreement to avoid prosecution for its actions in Singapore and agreed to pay more than $510 million.
• Constellation (CEG, +10%) is shifting focus to grid-connected AI data center energy projects.
• Hims & Hers shares jump 18% as first-quarter sales more than double.
• AMD +2% after report. The company beat expectations: “We got off to a strong start to 2025 as year-over-year growth accelerated for the fourth consecutive quarter, driven by strength in our core business and expansion in data centers and AI.”
And it improved expectations.
• UPST down 16% after earnings: Shares of the AI-powered lending platform are falling in after-hours trading as investors look for higher returns.
The company cut its outlook for the current quarter, though it maintained a healthy outlook for the full year.
• The Fed's high interest rates have created a threat to demand from borrowers, many of whom are struggling to keep up with bills and rising costs of living.
• RIVN -2% post-report. The company cuts its 2025 sales forecast and raises its capital expenditure forecast on demand concerns.
SMCI down 5% after report. The company again lowered its forecast for this financial year.
• EA up 5% after report EA lowered its profit and revenue forecasts but improved its forecast for growth in a key demand metric (net orders) after concerns earlier in the year about gamer fatigue.
• CSCO +1% this morning. Cisco says it has a new chip that will allow “quantum networks to scale” and reduce the time it takes to deploy useful quantum computing from decades to five to ten years.
Key events that could impact markets on Wednesday:
- US Federal Reserve meeting.
Current Fundamental Reviews
• Eurozone Business Activity Indicators: Eurozone Services PMI (Apr) = 50.1 (exp. 49.7/ prev. 51.0).
Eurozone PPI Inflation Indicators: y/y = 1.9% (exp. 2.0%/ prev. 3.0%).
• US Trade Balance data.
Trade Balance = -140.50 billion (expected -136.8 billion/previous -123.20 billion).
Exports = 278.50 billion (previous 278.50 billion).
Imports = 419.00 billion (previous 401.10 billion).
The U.S. trade deficit with other countries widened to a record $140.5 billion in March as U.S. companies panic-buy overseas goods due to tariffs.
• The People's Bank of China has resumed monetary stimulus.
The interest rate on loans to commercial banks will be cut by 0.25% to 1.5%. The central bank also cut the reserve ratio - the amount of money banks must hold in their reserves.
High tariffs imposed by President Donald Trump have begun to hurt China's export-dependent economy, and Chinese authorities are making desperate attempts to save the economy from collapse.
• India launched a military "Operation Sindoor". Sindoor is a red ritual powder that is applied as a drop on the forehead of married women and widows.
India launched a missile strike on "terrorist infrastructure in Pakistan and Pakistan-occupied Jammu and Kashmir" from where terrorist attacks against India were planned and launched.
A total of nine targets were attacked.
Pakistan launched a retaliatory missile strike on an Indian air base in Indian-controlled Kashmir. Pakistan's air defenses allegedly shot down five Indian fighter jets.
Earlier, Pakistan's defense minister said that Islamabad would not allow "any other country to live on this planet without us."
• US Treasury Secretary Bessent:
"We are currently in discussions with 17-18 key trading partners, but we have not yet started a dialogue with China."
First quarter GDP figures are expected to be revised upward.
"There is no evidence that the US is in recession."
"The US will never default - the debt ceiling will be raised."
• US Commerce Secretary Lutnik:
- It's time for other countries to open their markets to the US
- Agreements coming soon
- The first trade agreement should be with one of the 10 largest economies.
• Hegseth discussed official Pentagon business in at least 10 Signal chats – WSJ. In at least one case, Hegseth asked his aides to disseminate information about plans for a military operation to foreign countries.
/ Another candidate for “departure.”
• The number of senior officers of the US Armed Forces will be reduced by 20%. This follows from the published memorandum of the department. In addition, it is planned to reduce the number of senior officers of the army and navy by 10%, as well as the number of generals of the National Guard by 20%.
• Hungarian Commissioner Blocks EU Plan to Wean Off Russian Energy, Orban Once Again Attacks Zelensky
The Hungarian government's actions run counter to its formal commitment to be independent of its national political interests - Politico.
• Britain and India have struck a trade deal amid tariff tensions with the US.
The deal sees India gradually cut import duties, with the vast majority of goods sold under the trade becoming "completely duty-free within a decade".
• EU expects Trump to expand tariffs on goods worth €549 billion, covering up to 97% of exports, - Bloomberg
The EU is preparing proposals to reduce barriers and increase investment in the US.
• The EU's plan for a phased phase-out of Russian gas includes a ban on European companies signing contracts for energy supplies from Russia.
The new restrictions could lead to an increase in LNG supplies to Europe from the US - RTRS.
• China expressed its readiness to host the President of the European Council and the President of the European Commission for a new round of China-EU leaders' summit.
Xi Jinping: "China and the EU should jointly oppose unilateralism. We are ready to work with EU leaders to expand mutual opening-up and properly resolve frictions and differences."
• Chinese retailers' advertising in France and the UK is at an all-time high.
Shein and Temu are shifting ad budgets to Europe and Brazil as Trump imposes new tariffs.
• China on the brink of deeper deflation. China faces the risk of a deflationary spiral as ultra-high U.S. tariffs force exporters to shift goods to the domestic market. The move could further depress prices in an economy already suffering from weak demand and excess capacity, CNBC.
• Poland has accused Russia of significant interference in the presidential elections.
“During the current presidential elections in Poland, we are facing unprecedented attempts by Russia to interfere in the electoral process,” said Deputy Prime Minister and Minister of Digital Technologies Krzysztof Gawkowski.
• CDU leader Friedrich Merz failed to gain a majority of votes in the Bundestag to become Chancellor of Germany on his first attempt.
This is an extremely rare case: since 1949, all candidates nominated by the President of the FRG have always been elected on the first ballot.
He was nevertheless elected in the second round.
• Saudi Arabia is preparing to strike a major mining and mineral deal with the United States.
The Saudi cabinet announced the pending agreement in a statement carried by the country's state news agency on Tuesday. Details of the agreement were not disclosed.
• The Canadian province of Alberta may hold a referendum on secession from the country in 2026, according to the province's premier.
Alberta's authorities are unhappy with the central government's policies, and the Liberal Party, which won the recent elections, in their opinion, does not represent the interests of the region's residents.
• The Israeli Air Force destroyed the international airport in the Yemeni capital Sani.
The terminal and all passenger planes were destroyed. They also attacked the Dahban power station.