June S&P 500 E-Mini futures (ESM25) are up +1.06%, and June Nasdaq 100 E-Mini futures (NQM25) are up +1.35% this morning as sentiment got a boost after U.S. President Donald Trump said the U.S. has reached a trade agreement with the U.K.
In a Truth Social post on Wednesday night, President Trump announced plans to unveil a “major” trade deal on Thursday, without disclosing the name of the country. Bloomberg reported that the administration is likely to announce a deal with the United Kingdom. On Thursday morning, Mr. Trump confirmed in a post on his social media platform that the deal was indeed with the U.K.
“The agreement with the United Kingdom is a full and comprehensive one that will cement the relationship between the United States and the United Kingdom for many years to come,” Trump wrote in a post.
Futures linked to the tech-heavy Nasdaq 100 outperformed as chip stocks climbed in pre-market trading after the Commerce Department said it doesn’t intend to implement the AI Diffusion rule. Nvidia (NVDA), Broadcom (AVGO), and Micron Technology (MU) are up more than +1%.
As widely anticipated, the Federal Reserve held interest rates steady yesterday. The Federal Open Market Committee voted unanimously to keep the federal funds rate in a range of 4.25%-4.50% for the third consecutive meeting. In a post-meeting statement, officials said that “uncertainty about the economic outlook has increased further,” adding that “the risks of higher unemployment and higher inflation have risen.”
At a press conference, Fed Chair Jerome Powell stated that policymakers are in no rush to adjust interest rates, noting that tariffs could lead to higher inflation and unemployment. “The effects on inflation could be short-lived, reflecting a one-time shift in the price level,” he said, while warning that it’s “also possible that the inflationary effects could instead be more persistent.”
“The Fed is content to stand pat until there is economic data that compels them to change interest rates. With inflation already elevated and expected to move higher, it will take evidence of a material downturn in the job market before the Fed resumes cutting interest rates,” said Greg McBride at Bankrate.
In yesterday’s trading session, Wall Street’s major indexes ended in the green. Charles River Laboratories (CRL) surged over +18% and was the top percentage gainer on the S&P 500 after the drug development contractor raised its full-year adjusted EPS guidance and announced a strategic review of its business. Also, chip stocks gained ground after Bloomberg reported that the Trump administration plans to rescind Biden-era AI chip curbs, with Nvidia (NVDA) and Qualcomm (QCOM) rising more than +3%. In addition, Walt Disney (DIS) climbed over +10% and was the top percentage gainer on the Dow after the media and entertainment conglomerate posted upbeat FQ2 results and lifted its full-year adjusted EPS guidance. On the bearish side, Alphabet (GOOGL) slumped more than -7% and was the top percentage loser on the S&P 500 after Bloomberg reported that Apple is “actively looking” at reshaping the Safari browser on its devices to focus on AI-powered search engines amid the potential breakdown of its deal with Google.
Economic data released on Wednesday showed that U.S. March consumer credit rose by $10.17B, stronger than expectations of $9.80B.
Meanwhile, U.S. rate futures have priced in a 79.8% probability of no rate change and a 20.2% chance of a 25 basis point rate cut at the next central bank meeting in June.
First-quarter corporate earnings season continues, with market participants anticipating fresh reports from prominent companies today, including Shopify (SHOP), ConocoPhillips (COP), Monster Beverage (MNST), Coinbase Global (COIN), and Kenvue (KVUE). 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.
On the economic data front, investors will focus on U.S. Initial Jobless Claims data, which is set to be released in a couple of hours. Economists expect this figure to be 231K, compared to last week’s number of 241K.
U.S. Unit Labor Costs and Nonfarm Productivity preliminary data will also be closely watched today. Economists forecast Q1 Unit Labor Costs to be +5.3% q/q and Nonfarm Productivity to be -0.4% q/q, compared to the fourth-quarter numbers of +2.2% q/q and +1.5% q/q, respectively.
U.S. Wholesale Inventories data will be released today as well. Economists expect the final March figure to be +0.5% m/m, compared to +0.3% m/m in February.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.299%, up +0.56%.
The Euro Stoxx 50 Index is up +1.00% this morning as investors digest a slew of corporate earnings reports and rate decisions from regional central banks while also awaiting a potential U.K.-U.S. trade deal. Investor sentiment in the region was upbeat as reports indicated that Britain is set to sign a trade agreement with the U.S. Data from the Federal Statistical Office released on Thursday showed that German exports rose more than expected in March, driven by rising U.S. demand ahead of impending tariffs. Separately, data showed that Germany’s monthly industrial production jumped in March, supported by U.S. companies stockpiling imported goods in anticipation of tariffs from the Trump administration. Meanwhile, Sweden’s central bank kept its key policy rate at 2.25% on Thursday but signaled that additional rate cuts may be forthcoming if Trump’s tariff hikes pose a risk to economic growth and drive inflation down. Norway’s central bank also left interest rates unchanged at a 17-year high of 4.50%. Investors are now awaiting the Bank of England’s monetary policy decision due later in the day, with the central bank widely expected to lower its benchmark rate by 25 basis points to 4.25%. In corporate news, AB Inbev (ABI.BB) rose over +3% after the beer brewer posted better-than-expected Q1 operating profit. Also, Siemens Energy AG (ENR.D.DX) gained more than +2% after boosting its full-year guidance. At the same time, Ap Moller Maersk A/S (MAERB.C.DX) fell over -2% after the shipping group lowered its full-year global container market forecast.
Germany’s Exports, Germany’s Imports, and Germany’s Industrial Production data were released today.
The German March Exports stood at +1.1% m/m, stronger than expectations of +1.0% m/m.
The German March Imports arrived at -1.4% m/m, weaker than expectations of +0.4% m/m.
The German March Industrial Production came in at +3.0% m/m, stronger than expectations of +0.9% m/m.
Asian stock markets today closed in the green. China’s Shanghai Composite Index (SHCOMP) closed up +0.28%, and Japan’s Nikkei 225 Stock Index (NIK) closed up +0.41%.
China’s Shanghai Composite Index closed higher today, extending yesterday’s gains after Beijing announced a slew of measures to bolster the economy and improve confidence in the private sector ahead of U.S.-China trade talks this weekend. Bank stocks climbed on Thursday after regulators said that sovereign fund Huijin would continue to help stabilize the market. Defense stocks also advanced amid escalating geopolitical tensions, as Pakistan pledged retaliation following an Indian strike in response to tourist deaths. Meanwhile, Chinese officials on Thursday announced plans to use a new law to support the private sector. Wang Zhenjiang, China’s vice-minister of justice, said at a news conference that the law, set to take effect on May 20th, has for the first time established the legal status of the private sector and outlined the government’s support for it. On Wednesday, the People’s Bank of China cut the seven-day reverse repurchase rate to 1.4% from 1.5%, effective today, and announced that banks’ reserve requirement ratio would be lowered by half a percentage point on May 15th. BNP Paribas analysts wrote in a note that they anticipate a 20 basis point cut in the policy rate in the second half of the year and an additional 50 basis point reduction in the required reserve ratio for the remainder of the year to offset downward pressure on the economy. Investor attention is now directed toward U.S.-China trade talks, as U.S. Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer are set to meet with China’s economic czar, He Lifeng, on Saturday in Switzerland. Goldman Sachs expects “the effective U.S. tariff rate on Chinese imports to fall to around 60% from about 160% relatively soon.” In corporate news, Xiamen Sunrise Group jumped over +10% after the U.S. Department of Commerce denied a petition to extend anti-dumping duties to steel wheels manufactured by the company’s Vietnamese subsidiary.
Japan’s Nikkei 225 Stock Index ended higher today as sentiment was boosted by U.S. President Donald Trump’s announcement of plans to unveil a “major” trade deal on Thursday. While the Trump administration is reportedly set to announce an agreement with the U.K., investors are also watching for any developments on a trade deal with Japan, after Trump earlier stated that there had been “big progress” in negotiations to reach an agreement with the country. Chip stocks outperformed on Thursday, tracking an overnight rally in their U.S. peers after Bloomberg reported that the Trump administration plans to rescind some Biden-era AI chip curbs. Meanwhile, minutes from the Bank of Japan’s March meeting released on Thursday revealed that policymakers were split on how soon the central bank should raise interest rates again, as uncertainty linked to U.S. tariff policies intensified. “Downside risks stemming from U.S. policies had rapidly heightened and, depending on future developments in its tariff policy, it was quite possible that these risks would even have a significant negative impact on Japan’s real economy,” one member said. Still, another member noted that despite elevated uncertainty, the BOJ was not necessarily bound to conduct monetary policy in an excessively cautious way. In corporate news, Torii Pharmaceutical climbed over +13% after Shionogi agreed to acquire the drugmaker for more than 150 billion yen. Also, NTT Data surged more than +16% after the Nikkei newspaper reported that telecom giant NTT plans to initiate a tender offer to acquire the remaining shares in the company. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed down -5.76% to 28.13.
Pre-Market U.S. Stock Movers
Chip stocks are moving higher in pre-market trading after the Commerce Department said it doesn’t intend to implement the AI Diffusion rule. Nvidia (NVDA), Broadcom (AVGO), and Micron Technology (MU) are up more than +1%.
Applovin (APP) surged over +15% in pre-market trading after the digital advertising company posted upbeat Q1 results and provided strong Q2 advertising revenue guidance.
Carvana (CVNA) climbed more than +5% in pre-market trading after the used-car dealer reported higher earnings and revenue in Q1.
Arm Holdings (ARM) slumped more than -9% in pre-market trading after the semiconductor and software design company issued disappointing FQ1 guidance.
Cleveland-Cliffs (CLF) slid over -7% in pre-market trading after the steelmaker posted a wider-than-expected Q1 loss.
You can see more pre-market stock movers here
Today’s U.S. Earnings Spotlight: Thursday - May 8th
Shopify (SHOP), ConocoPhillips (COP), McKesson (MCK), Brookfield (BN), Itau Unibanco (ITUB), Canadian Natural (CNQ), Monster Beverage (MNST), Cheniere Energy (LNG), Coinbase Global (COIN), Sempra Energy (SRE), Kenvue (KVUE), Cloudflare (NET), Wheaton Precious Metals (WPM), Sun Life Financial (SLF), HubSpot Inc (HUBS), TKO Holdings (TKO), Chunghwa Telecom (CHT), Franco-Nevada (FNV), Restaurant Brands Int (QSR), The Trade Desk (TTD), LPL Financial (LPLA), Microchip (MCHP), Rocket (RKT), Pembina Pipeline (PBA), Natera Inc (NTRA), Cenovus Energy Inc (CVE), Expedia (EXPE), Warner Bros. Discovery (WBD), Toast (TOST), BCE Inc (BCE), Royalty Pharma (RPRX), News Corp (NWS), Insulet (PODD), Pinterest (PINS), DraftKings (DKNG), Affirm Holdings (AFRM), Evergy (EVRG), News Corp A (NWSA), Warner Music (WMG), Alliant Energy (LNT), US Foods (USFD), Tapestry (TPR), Paramount Global (PARA), Carlyle Group (CG), Somnigroup International (SGI), Aurora Innovation (AUR), Insmed (INSM), Akamai (AKAM), Lamar (LAMR), Illumina (ILMN), Molson Coors Brewing (TAP), Texas Roadhouse (TXRH), Solventum (SOLV), Sharkninja (SN), Viatris (VTRS), Rocket Lab USA (RKLB), Globus Medical (GMED), EPAM Systems (EPAM), Planet Fitness Inc (PLNT), Dropbox (DBX), MACOM Tech (MTSI), Federal Realty (FRT), Match Group (MTCH), Life Time Holdings (LTH), Post (POST), Pharming Group (PHAR), Trex (TREX), Onto Innovation (ONTO), Choice Hotels (CHH), ACI Worldwide (ACIW), Lincoln National (LNC), Millicom (TIGO), Nova (NVMI), Crocs (CROX), LYFT (LYFT), Americold Realty (COLD), Affiliated Managers (AMG), Grindr (GRND), Main Street Capital (MAIN), Nexstar (NXST), Bill Com (BILL), Marathon Digital (MARA), Installed Building (IBP), SGHC Limited (SGHC), Assured Guaranty (AGO), Valvoline (VVV), Adtalem Education (ATGE), Ingram Micro Holding (INGM), Prestige Consumer Health (PBH), Compass (COMP), Victory Capital (VCTR), MP Materials (MP), Jfrog (FROG), Nelnet (NNI), Allete (ALE), Maximus (MMS), Six Flags Entertainment (FUN), SoundHound AI (SOUN), StoneCo (STNE), MDU Resources (MDU), Clear Secure (YOU), Avepoint (AVPT), Allegro (ALGM), Tecnoglass (TGLS), ICU Medical (ICUI), Griffon (GFF), Haemonetics (HAE), TransMedics (TMDX), Zai Lab (ZLAB), Sensata Tech (ST), Nomad Foods (NOMD), Crinetics Pharma (CRNX), CarGurus (CARG), Alight (ALIT), Privia Health Group (PRVA), Peloton Interactive (PTON), Tegna (TGNA), Alarm.com Holdings (ALRM), Outfront Media (OUT), First Advantage (FA), Cogent (CCOI), Rumble (RUM), PENN Entertainment (PENN), Ringcentral Inc (RNG), Innospec (IOSP), YETI (YETI), Melco Resorts & Entertainment (MLCO), CleanSpark (CLSK), Yelp (YELP), Synaptics (SYNA), Appian (APPN), DoubleVerify Holdings (DV), Sweetgreen (SG), Alamo (ALG), D Wave Quantum (QBTS), Playtika (PLTK), Ligand (LGND), Progyny (PGNY), Vericel Corp Ord (VCEL), Warby Parker (WRBY).
