U.S. Stocks May Lack Direction Ahead Of Key Earnings, Economic News

The major U.S. index futures are currently pointing to a roughly flat open on Monday, with stocks likely to show a lack of direction following the strong upward move seen last week.

Traders may be reluctant to make significant moves as the look ahead to the release of key earnings and economic news in the coming days.

Four of the “Magnificent Seven” companies – Amazon (AMZN), Apple (AAPL), Meta Platforms (META) and Microsoft (MSFT) – are among the companies due to report their quarterly results this week.

Big-name companies like Coca-Cola (KO), Visa (V), Eli Lilly (LLY), Chevron (CVX) and Exxon Mobil (XOM) are also due to report their quarterly results.

The Labor Department’s monthly jobs report is also likely to be in focus later this week along with the Federal Reserve’s preferred readings on consumer price inflation.

Traders are also likely to keep a close eye on developments on the trade front, with Treasury Secretary Scott Bessent telling ABC News’ “This Week” on Sunday he believes an agreement in principle can reached on “17 or 18 important trade deals” the administration is currently negotiating.

“A trade deal can take months, but an agreement in principle and the good behavior and staying within the parameter of the deal by our trading partners can keep the tariffs there from ratcheting back to the maximum level,” Bessent said.

Meanwhile, in a separate interview with CNBC’s “Squawk Box” this morning, Bessent said he believes it’s up to China to de-escalate, “because they sell five times more to us than we sell to them,”

After turning in a lackluster performance early in the session, stocks saw considerable volatility over the course of the trading day on Friday. The major averages showed wild swings as the day progressed before eventually closing in positive territory.

The Nasdaq and the S&P 500 ended the day firmly positive, closing higher for the fourth straight session. The Nasdaq jumped 216.90 points or 1.3 percent to 17,382.94 and the S&P 500 climbed 40.44 points or 0.7 percent to 5,525.21, while the narrower Dow inched up 20.10 points or 0.1 percent to 40,113.50.

For the week, the Nasdaq spiked by 6.7 percent, the S&P 500 surged by 4.6 percent and the Dow shot up by 2.5 percent.

The volatility on the day came as traders continued to keep a close eye on the developments on the trade front, with President Donald Trump refuting China’s claims that the two countries have not held any trade negotiations.

“They had a meeting this morning,” Trump told reporters on Thursday. “It doesn’t matter who ‘they’ is. We may reveal it later, but they had meetings this morning, and we’ve been meeting with China.”

Several reports citing U.S. businesses also said China has exempted some U.S. imports from its 125 percent tariffs

In U.S. economic news, a report released by the University of Michigan showed consumer sentiment in the U.S. deteriorated modestly less than previously estimated in the month of April.

The University of Michigan said its consumer sentiment index for April was upwardly revised to 52.2 from a preliminary reading of 50.8. Economists had expected the index to be unrevised.

Despite the upward revision, the consumer sentiment index is still down sharply from 57.0 in March and marks its lowest level since hitting 51.5 in July 2022.

Among individual stocks, shares of Intel (INTC) plunged by 6.7 percent after the semiconductor giant reported better than expected first quarter results but provided disappointing guidance for the current quarter.

Shares of T-Mobile (TMUS) also plummeted by 11.2 percent after the telecom company reported first quarter earnings and revenues that exceeded estimates but weaker than expected “postpaid” phone subscriber additions.

On the other hand, shares of Google parent Alphabet (GOOGL) jumped by 1.7 percent after the company reported first quarter results that exceeded expectations on both the top and bottom lines.

Networking stocks turned in some of the market’s best performances on the day, with the NYSE Arca Networking Index surging by 2.4 percent.

Significant strength also emerged among software stocks, as reflected by the 1.4 percent gain posted by the Dow Jones U.S. Software Index.

Pharmaceutical and semiconductor stocks also saw considerable strength, while gold and airline stocks showed notable moves to the downside.

Commodity, Currency Markets

Crude oil futures are unchanged after rising $0.23 to $63.02 a barrel last Friday. Meanwhile, after plunging $50.20 to $3,298.40 an ounce in the previous session, gold futures are climbing $12.50 to $3,310.90 an ounce.

On the currency front, the U.S. dollar is trading at 143.19 yen versus the 143.67 yen it fetched at the close of New York trading on Friday. Against the euro, the dollar is trading at $1.1365 compared to last Friday’s $1.1365.

Asia

Asian stocks rose broadly on Monday amid revived hopes for progress in trade talks and expectations of further stimulus from China.

U.S. Treasury Secretary Scott Bessent said the Trump administration is working on bilateral trade deals with 17 key trading partners, not including China, and that the latter needs a de-escalation.

Oil prices were little changed in Asian trading and gold fell over 1 percent below $3,300 per ounce as the dollar strengthened on easing Sino-U.S. tensions.

China’s Shanghai Composite Index slipped 0.2 percent to 3,288.41 as investors awaited the details of new stimulus from a key economic policy meeting.

China’s finance minister Lan Fo’an said the country will take measures to achieve its annual economic growth target of around 5 percent despite escalating trade tensions.

Hong Kong’s Hang Seng Index finished marginally lower at 21,971.96 as China denied any talks with the U.S. over tariff exemptions, calling out Washington for “misleading” the public.

Japanese markets eked out modest gains ahead of the Bank of Japan’s rate decision due later in the week, with no policy change expected.

Japan’s top currency diplomat Atsushi Mimura today denied a newspaper report that U.S. Treasury Secretary Scott Bessent called for a stronger yen against the dollar.

The Nikkei 225 Index rose 0.4 percent to 35,839.99, extending gains for a fourth day running as U.S. tariff negotiations progress. The broader Topix Index settled 0.9 percent higher at 2,650.61 ahead of a national holiday on Tuesday.

Toyota Motor rallied 3.6 percent after an announcement that it may invest in key parts supplier Toyota Industries.

Seoul stocks edged up slightly in cautious trading, as investors assessed interim progress in trade negotiations between Seoul and Washington.

The Kospi inched up by 0.1 percent to 2,548.86, extending gains for a second session after Industry Minister Ahn Duk-geun said that South Korea plans to approach trade talks with the United States “calmly and cautiously.”

Earlier, the U.S. Treasury Department said that Thursday’s discussions were focused on “an expanded equilibrium which encourages rather than restricts trade.”

Australian markets closed higher for a third consecutive session, with tech and energy stocks pacing the gainers.

The benchmark S&P/ASX 200 Index rose 0.4 percent to 7,997.10 amid rising expectations of an RBA rate cut in May. The broader All Ordinaries Index closed up 0.4 percent at 8,203.90.

Across the Tasman, New Zealand’s benchmark S&P/NZX-50 Index climbed 0.7 percent to 12,098.89.

Europe

European stocks have moved higher on Monday as tariff tensions ease and investors look ahead to a busy week of earnings, with four of the Magnificent Seven companies – Amazon, Apple, Meta Platforms and Microsoft – due to report their quarterly results.

Heavyweights such as Visa, Coca-Cola, Eli Lilly and Berkshire Hathaway are also on the docket.

Closer to home, Adidas, AstraZeneca, Novartis, Stellantis, Volkswagen, Airbus, Shell, Standard Chartered, Deutsche Bank, Barclays and Santander are among the prominent companies due to report their financial results this week.

The French CAC 40 Index is up by 0.9 percent, the German DAX Index is up by 0.5 percent and the U.K.’s FTSE 100 Index is up by 0.2 percent.

Deliveroo has moved sharply higher. The British meal delivery company has suspended its 100 million pound ($133.13 million) share buyback program after receiving a proposal from DoorDash to buy all of its shares.

Aircraft maker Airbus has also moved to the upside after it finalized an agreement to take some assets from Spirit AeroSystems.

Meanwhile, Plus500 has declined. The online trading platform reported a 5 percent year-on-year drop in revenues in the first quarter.

Germany’s Merck KGaA has also moved marginally lower after it struck a deal to buy U.S. biotech company SpringWorks Therapeutics for an equity value of $3.9 billion.

U.S. Economic News

No major U.S. economic data is scheduled to be released today.