June S&P 500 E-Mini futures (ESM25) are down -0.75%, and June Nasdaq 100 E-Mini futures (NQM25) are down -1.02% this morning, pointing to a lower open on Wall Street as uncertainty about U.S. trade policy weighed on investors’ risk appetite. 

U.S. President Donald Trump on Sunday announced a 100% tariff on foreign-produced films imported into the U.S., tempering last week’s optimism about a potential easing of trade tensions. Also, President Trump stated that he had no plans to speak with his Chinese counterpart, Xi Jinping, this week, though he indicated that trade agreements with other unspecified partners could be announced as early as this week.

This week, investors look ahead to the Federal Reserve’s interest rate decision as well as a fresh batch of U.S. economic data and corporate earnings reports.

In Friday’s trading session, Wall Street’s major equity averages closed higher, with the S&P 500 and Nasdaq 100 notching 5-week highs and the Dow posting a 1-month high. DexCom (DXCM) surged over +16% and was the top percentage gainer on the S&P 500 and Nasdaq 100 after the medical devices maker reported better-than-expected Q1 revenue. Also, chip stocks rallied, with Arm Holdings (ARM) climbing more than +6% and ON Semiconductor (ON) gaining over +5%. In addition, Duolingo (DUOL) soared more than +21% after the mobile learning platform posted upbeat Q1 results and raised its full-year bookings guidance. On the bearish side, Apple (AAPL) fell over -3% and was the top percentage loser on the Dow after the iPhone maker reported weaker-than-expected revenue from Greater China in FQ2.

The U.S. Labor Department’s report on Friday showed that nonfarm payrolls rose 177K in April, stronger than expectations of 138K. Also, U.S. April average hourly earnings rose +0.2% m/m and +3.8% y/y, weaker than expectations of +0.3% m/m and +3.9% y/y. In addition, the U.S. unemployment rate was unchanged at 4.2% in April, in line with expectations. Finally, U.S. March factory orders rose +4.3% m/m, slightly weaker than expectations of +4.4% m/m.

“A lot of people — based on Liberation Day and the events since — have forecast economic Armageddon, and every time economic Armageddon doesn’t happen, it’s good news. Maybe it’s just too early. A lot of the phenomenon that people fear haven’t really had time to sink into the data yet,” said Lawrence Creatura, a fund manager at PRSPCTV Capital LLC.

The U.S. Federal Reserve’s interest rate decision and Chair Jerome Powell’s post-policy meeting press conference will take center stage this week. The central bank is widely expected to keep the Fed funds rate unchanged in a range of 4.25% to 4.50%, despite recent pressure from President Trump to lower interest rates. Market watchers’ attention will be on any indications of whether rates might be lowered later this year to support the economy amid tariff-related pressures.

The Fed is growing more concerned about economic growth and will likely “cut interest rates as soon as it can be reasonably sure that inflation is not spiraling out of control,” according to Commerzbank analysts.

First-quarter corporate earnings season continues, and investors await new reports from notable companies this week, including Advanced Micro Devices (AMD), Arm (ARM), Palantir Technologies (PLTR), Arista Networks (ANET), Uber Tech (UBER), Ford (F), Walt Disney (DIS), Applovin (APP), DoorDash (DASH), and Shopify (SHOP). According to Bloomberg Intelligence, companies in the S&P 500 are expected to post an average +6.7% increase in quarterly earnings for Q1 compared to the previous year.

In addition, investors will continue to monitor economic data for signs of how tariffs and the uncertainty they create are affecting economic activity. This week’s noteworthy data releases include U.S. Unit Labor Costs (preliminary), Nonfarm Productivity (preliminary), Initial Jobless Claims, Wholesale Inventories, Exports, Imports, Trade Balance, and Consumer Credit.

On Friday, the Fed’s blackout period ends, with Fed officials Williams, Kugler, Goolsbee, Waller, and Cook set to deliver remarks.

Today, investors will focus on the U.S. ISM Non-Manufacturing PMI and S&P Global Services PMI, set to be released in a couple of hours. Economists forecast the April ISM services index to be 50.2 and the S&P Global services PMI to be 51.4, compared to the previous values of 50.8 and 54.4, respectively.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.324%, up +0.09%.

The Euro Stoxx 50 Index is up +0.11% this morning as investors monitor developments on the trade front and await monetary policy decisions from several central banks in the region. U.S. President Donald Trump said he had no plans to speak with his Chinese counterpart, Xi Jinping, this week, though he signaled openness to lowering tariffs on Chinese imports to help reinvigorate trade momentum. Energy stocks underperformed on Monday as crude oil prices plunged after OPEC+ agreed to further increase output. A survey released on Monday showed that investor morale in the Eurozone rebounded more sharply than anticipated in May after Trump’s tariffs led to a sharp decline in sentiment across the bloc last month. “This is remarkable, as it shows that investors have largely abandoned the recession fears they expressed last month,” said Sentix in a statement. Meanwhile, investors are awaiting the Bank of England’s monetary policy decision on Thursday. The BoE is widely expected to lower its benchmark rate by 25 basis points to 4.25% amid recent softer inflation data and falling energy prices. Investors will also focus on the monetary policy decisions from the Norges Bank and the Riksbank on Thursday. In corporate news, Erste Group Bank AG (EBS.V.DX) climbed over +5% after the Austrian lender agreed to buy around a 49% stake in Poland-based Santander Bank Polska and 50% of Polish asset manager Santander TFI.

Eurozone’s Sentix Investor Confidence Index was released today.

Eurozone May Sentix Investor Confidence Index came in at -8.1, stronger than expectations of -14.9.

Financial markets in Japan and China were closed for holidays.

China’s Shanghai Composite Index was closed today for the Labor Day holiday. Mainland China’s financial markets will reopen on Tuesday.

Japan’s Nikkei 225 Stock Index was closed today for the Children’s Day holiday. Financial markets in Japan will remain closed on Tuesday in observance of Greenery Day. The markets will reopen on Wednesday.

Pre-Market U.S. Stock Movers

Berkshire Hathaway (BRK.A) dropped more than -2% in pre-market trading after legendary investor Warren Buffett said he would step down as CEO of the conglomerate at the end of the year.

Netflix (NFLX) slumped over -3% and Walt Disney (DIS) fell more than -1% in pre-market trading after President Trump announced a 100% tariff on foreign-produced films imported into the U.S.

Energy stocks are falling in pre-market trading, with the price of WTI crude down more than -2% after OPEC+ agreed to further increase output. Exxon Mobil (XOM), Devon Energy (DVN), Occidental Petroleum (OXY), and Schlumberger (SLB) are down more than -2%.

Microsoft (MSFT) slid over -1% in pre-market trading after Phillip Securities downgraded the stock to Accumulate from Buy.

Shopify (SHOP) fell more than -2% in pre-market trading after BNP Paribas Exane downgraded the stock to Neutral from Outperform.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Monday - May 5th

Palantir (PLTR), Vertex (VRTX), Williams (WMB), CRH (CRH), Realty Income (O), Cummins (CMI), Ford Motor (F), Diamondback (FANG), Ares Management (ARES), BioNTech (BNTX), Tyson Foods (TSN), Zimmer Biomet (ZBH), Coterra Energy (CTRA), Loews (L), ON Semiconductor (ON), Clorox (CLX), Corebridge Financial (CRBG), Sun (SUI), Aecom Technology (ACM), CNA Financial (CNA), Neurocrine (NBIX), BWX Tech (BWXT), Bellring (BRBR), Hims Hers Health (HIMS), TIM Participacoes (TIMB), Henry Schein (HSIC), Fabrinet (FN), Corcept (CORT), Regal Beloit (RRX), Bright Horizons (BFAM), Vornado (VNO), Lattice (LSCC), TG (TGTX), JBTMarel (JBTM), Viper Energy Ut (VNOM), Axsome Therapeutics Inc (AXSM), Air Lease (AL), Mattel (MAT), Celanese (CE), Sterling Construction (STRL), Sterling Construction (STRL), Inspire Medical Systems (INSP), One Gas Inc (OGS), Paymentus (PAY), Mueller Water Products (MWA), Cabot Corp (CBT), Sabra (SBRA), Palomar (PLMR), Kilroy (KRC), Golub (GBDC), Freshpet Inc (FRPT), Matson (MATX), Inter Parfums (IPAR), Primoris (PRIM), National Health Investors (NHI), Dorman (DORM), Otter Tail (OTTR), Black Stone Minerals (BSM), National Storage Affiliates Trust (NSA), IAC/InterActiveCorp (IAC), Titan America (TTAM), Twist Bioscience (TWST), Recursion Pharmaceuticals (RXRX), Certara (CERT), Park Hotels & Resorts (PK), Tidewater (TDW), Addus (ADUS), Crescent Energy (CRGY), BioCryst (BCRX), Atlas Energy Solutions (AESI), Upwork (UPWK), Playa Hotels & Resorts (PLYA).