U.S. stock futures jumped on Monday after a muted day of trade on Friday. Futures of major benchmark indices were trading over 2% in premarket.
U.S. and China announced a 90-day truce to pause the reciprocal tariffs on Monday and revised it from 125% to 10%. This comes after the White House and Chinese officials signaled significant headway in trade negotiations held in Geneva over the weekend.
The U.S. will maintain its 20% tariffs on Chinese imports linked to fentanyl, keeping the overall tariff level on China at 30%. "We had very productive talks and I believe that the venue, here in Lake Geneva, added great equanimity to what was a very positive process,” said the Treasury Secretary Scott Bessent after the talks.
The U.S.-China joint statement also indicated Beijing’s agreement to suspend or remove all non-tariff countermeasures implemented since April 2, including sanctions on specific U.S. firms and export limits on crucial minerals, according to the South China Morning Post.
Meanwhile, the 10-year Treasury bond yielded 4.44% and the two-year bond was at 3.98%. The CME Group's FedWatch tool‘s projections show markets pricing a 92.1% likelihood of the Federal Reserve keeping the current interest rates unchanged in its June meeting.
| Futures | Change (+/-) |
| Dow Jones | 2.12% |
| S&P 500 | 2.76% |
| Nasdaq 100 | 3.68% |
| Russell 2000 | 3.16% |
The SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust ETF (NASDAQ:QQQ), which track the S&P 500 index and Nasdaq 100 index, respectively, were slightly higher in premarket on Monday. The SPY was up 2.74% to $579.80, while the QQQ advanced 3.81% to $506.54, according to Benzinga Pro data.
Cues From Last Session:
Energy, real estate, consumer discretionary, and materials sectors advanced on Friday. While health care, communication services, consumer staples, and information technology sectors declined.
On the company-specific front, EchoStar Corp. (NASDAQ:SATS) rose 1.43% on Friday after reporting quarterly sales of $3.87 billion, down 3.6% year-over-year, in line with the Street view.
Plains All American Pipeline LP (NASDAQ:PAA) fell nearly 3% after it reported first-quarter revenue of $12.011 billion, missing the consensus of $14.26 billion. Adjusted EPS was 39 cents, missing the consensus of 43 cents.
The Dow Jones index declined 119 points or 0.29% to 41,249.38, whereas the S&P 500 index fell 0.071% to 5,659.91. Nasdaq Composite ended 0.004% higher at 17,928.92, and the small-cap gauge, Russell 2000, dropped 0.16% to 2,023.07.
| Index | Performance (+/-) | Value |
| Nasdaq Composite | 0.004% | 17,928.92 |
| S&P 500 | -0.071% | 5,659.91 |
| Dow Jones | -0.29% | 41,249.38 |
| Russell 2000 | -0.16% | 2,023.07 |
Insights From Analysts:
After last week, 90% of the S&P 500 companies have reported quarterly results, and the performance has been strong relative to expectations, said Brian Therien, the investment strategist at Edward Jones.
Seventy-eight percent have beaten analyst estimates, with an average upside surprise of 8.6%, he highlighted. Forecasts for first-quarter earnings growth of S&P 500 companies have been revised higher to 13.2%, from 6.7% at the end of the quarter.
Performance has been broad, with eight of the 11 sectors forecast to report higher earnings year-over-year.
“Wider earnings growth should drive more balanced market performance across sectors, strengthening the case for portfolio diversification, in our view,” Therien added.
Charles Schwab said in a note that they are maintaining a neutral “marketperform” rating on all sectors, a shift it made in April after the White House announced broad-reaching tariffs on imports.
“Uncertainty about the ultimate level and timing of the tariffs has made it difficult to assert a view on which sectors might outperform or underperform the S&P 500 index, so we are holding all sector ratings at Marketperform until we have more clarity on trade policy,” the note stated.
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Upcoming Economic Data
Here’s what investors will keep an eye on this week:
- On Monday, Fed Governor Adriana Kugler will speak at 10:20 a.m., and April’s monthly U.S. federal budget data will be released by 2:00 p.m. ET.
- On Tuesday, April’s NFIB optimism index will be out by 6:00 a.m., whereas headline and core CPI data for April will be released by 8:30 a.m. ET.
- On Wednesday, Fed Governor Christopher Waller will speak at 5:15 a.m., Fed Vice Chair Philip Jefferson will speak at 9:10 a.m., and San Francisco Fed President Mary Daly will speak at 5:40 p.m. ET.
- On Thursday, the initial jobless claims data for the week ended May 10 will be out by 8:30 a.m. ET.
- April’s U.S. retail sales, core and headline producer price index, May’s Empire State manufacturing survey, and Philadelphia Fed manufacturing survey will also be announced at 8:30 a.m. ET.
- Fed Chairman Jerome Powell will speak at 8:40 a.m. ET.
- April’s industrial production and capacity utilization will be out by 9:15 a.m. ET.
- March’s business inventories data and May’s home builder confidence index will be released by 10:00 a.m. ET.
- Fed Governor Michael Barr will speak at 2:05 p.m. ET.
- On Friday, April’s import price index, housing starts, and building permit data will be released by 8:30 a.m. ET.
- The preliminary consumer sentiment for May will be released by 10:00 a.m. ET.
Stocks In Focus:
- Fox Corp. (NASDAQ:FOXA) rose 0.52% in premarket on Monday as it is expected to report earnings before the opening bell. Analysts expect a quarterly earnings of 91 cents per share on the revenue of $4.18 billion.
- NRG Energy Inc. (NYSE:NRG) jumped 3.08% as Wall Street expects it to report earnings of $1.49 per share on revenue of $7.83 billion. before the opening bell.
- Southwest Gas Holdings Inc. (NYSE:SWX) dropped 4.85% ahead of its earnings. Analysts expect earnings of $1.50 per share on revenue of $1.50 billion.
- Davita Inc. (NYSE:DVA) was up 2.94% as Wall Street expects it to report earnings of $1.95 per share on revenue of $3.21 billion after the closing bell.
- Hawaiian Electric Industries Inc. (NYSE:HE) was 0.095% above the flatline after it reported first-quarter earnings of 23 cents per share, in line with market estimates. The company reported $744.07 million in sales during the quarter.
- Rio Tinto PLC ADR (NYSE:RIO) was up 2.93% after it signed a definitive agreement for the Winu project joint venture with Sumitomo Metal Mining.
- Pan American Silver Corp. (NYSE:PAAS) slumped 6.65% after announcing an agreement to acquire MAG Silver Corp. (NYSE:MAG), which was up 6.62% in premarket.
- Alibaba Group Holding Ltd. ADR (NYSE:BABA) was up 7.18%, JD.Com Inc. (NASDAQ:JD) jumped 6.05%, Baidu Inc. (NASDAQ:BIDU) advanced 4.64%, whereas PDD Holdings Inc. ADR (NASDAQ:PDD) gained 8.24% along with other Chinese peers amid the ongoing U.S.-China talks on tariff reductions.
Commodities, Gold, And Global Equity Markets:
Crude oil futures were trading higher in the early New York session by 2.85% to hover around $62.76 per barrel.
Gold Spot US Dollar fell 2.74% to hover around $3,233.54 per ounce. Its last record high stood at $3,500.33 per ounce. The U.S. Dollar Index spot was higher by 1.10% at the 101.4460 level.
Asian markets ended higher on Monday as India's S&P BSE Sensex, South Korea's Kospi, China’s CSI 300, Japan's Nikkei 225, Australia's ASX 200, and Hong Kong's Hang Seng index rose. European markets were also higher in early trade.
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