The S&P 500 Index ($SPX) (SPY) Monday closed up +0.06%, the Dow Jones Industrials Index ($DOWI) (DIA) closed up +0.28%, and the Nasdaq 100 Index ($IUXX) (QQQ) closed down -0.03%. June E-mini S&P futures (ESM25) are up +0.03%, and June E-mini Nasdaq futures (NQM25) are down -0.18%.
Stock indexes on Monday settled mixed, with the S&P 500 posting a 3-1/2 week high and the Dow Jones Industrials climbing to a 1-1/2 week high. Hopes that the US will be close to trade deals with its trading partners is a positive factor for stocks. US Treasury Secretary Bessent said the Trump administration is working on bilateral trade deals with 17 key trading partners, not including China. Lower T-note yields on Monday also supported stocks after the 10-year T-note yield fell to a 2-1/2 week low of 4.204%. The markets await earnings from four Magnificent Seven technology stocks this week, including Microsoft, Meta Platforms, Amazon.com, and Apple.
Monday’s US economic news was negative for stocks after the Apr Dallas Fed manufacturing survey of general business activity index fell more than expected to a 5-year low. Also, Nvidia fell more than -2% to lead chip stocks lower and pressure the Nasdaq 100 after the Wall Street Journal reported that Huawei is getting ready to test an artificial intelligence processor that could replace some Nvidia products.
The US Apr Dallas Fed manufacturing survey of general business activity index fell -19.5 to a 5-year low of -35.8, weaker than expectations of -17.0.
Market attention this week will focus on news of US tariffs and trade negotiations. On Tuesday, the Conference Board Apr consumer confidence index is expected to fall -5.3 points to 87.6. On Wednesday, Q1 GDP is expected at +0.4% (q/q annualized), with the Q1 core PCE price index up +3.0%. Wednesday also brings Mar personal spending (expected +0.6% m/m), Mar personal income (expected +0.4% m/m), and the Mar core PCE price index (expected unchanged m/m and +2.2% y/y). Finally, Microsoft and Meta Platforms release their quarterly earnings on Wednesday. On Thursday, the Apr ISM manufacturing index is expected to fall -1.0 to 48.0. Thursday also brings earnings results from Amazon.com and Apple. Friday brings Apr nonfarm payrolls (expected +130,000) and the Apr unemployment rate (expected unchanged at 4.2%). Also, Apr average hourly earnings are expected to climb +0.3% m/m and +3.9% y/y.
The markets are discounting the chances at 9% for a -25 bp rate cut after the May 6-7 FOMC meeting.
Q1 earnings reporting season is in full swing. According to data compiled by Bloomberg Intelligence, the market consensus is for Q1 year-over-year earnings growth of +6.7% for the S&P 500 stocks, down from expectations of +11.1% in early November. Full-year 2025 corporate profits for the S&P 500 are seen rising +9.4%, down from the forecast of +12.5% in early January.
Overseas stock markets on Monday settled mixed. The Euro Stoxx 50 rose to a 3-week high and closed up +0.33%. China’s Shanghai Composite closed down -0.29%. Japan’s Nikkei Stock 225 climbed to a 4-week high and closed up +0.38%.
Interest Rates
June 10-year T-notes (ZNM25) Monday closed up +12.5 ticks. The 10-year T-note yield fell -2.3 bp to 4.212%. June T-notes today recovered from early losses and rallied to a 2-1/2 week high, and the 10-year T-note yield fell toa 2-1/2 week low of 4.204%. Short covering emerged in T-notes Monday morning to push prices higher after the US Apr Dallas Fed manufacturing survey of general business activity index fell more than expected to a 5-year low, a dovish factor for Fed policy.
T-notes on Monday initially moved lower due to negative carryover from weakness in European government bonds. Increased corporate bond issuance is also bearish for T-notes as it will prompt bond dealers to short T-notes to hedge against as much as $35 billion in new securities expected to be priced this week.
European government bond yields on Monday moved higher. The 10-year German bund yield climbed to a 1-week high of 2.525% and finished up +5.2 bp to 2.521%. The 10-year UK gilt yield rose +3.0 bp to 4.509%.
ECB Governing Council member Villeroy de Galhau said the ECB has room to lower interest rates as the trade war triggered by US tariffs will weigh on the global economy but won’t affect the inflation trend in Europe.
ECB Governing Council member Rehn said that due to the fallout from US tariffs, “I find it reasonable to assume that there are downside risks to the inflation outlook in the ECB’s March projections.”
Swaps are discounting the chances at 100% for a -25 bp rate cut by the ECB at the June 5 policy meeting.
US Stock Movers
AbbVie (ABBV) closed up more than +3% to lead gainers in the S&P 500, adding to last Friday’s +3% gain after raising its full-year adjusted EPS estimate to $12.09-$12.29 from a previous estimate of $11.99-$12.19.
Boeing (BA) closed up more than +2% to lead gainers in the Dow Jones Industrials after Bernstein upgraded the stock to outperform from market perform with a price target of $218.
CG Oncology (CGON) closed up more than +24% after reporting positive results in a late-stage trial of its experimental therapy for bladder cancer.
ON Holding (ONON) closed up more than +3% after Citigroup upgraded the stock to buy from neutral with a price target of $60.
Jack in the Box (JACK) closed up more than +4% after Stifel upgraded the stock to buy from hold with a price target of $32.
Zscaler (ZS) closed up more than +1% after BNP Paribas Exane upgraded the stock to outperform from neutral with a price target of $260.
Nvidia (NVDA) closed down more than -2% to lead chip makers lower after the Wall Street Journal reported that Huawei is getting ready to test an artificial intelligence processor that could replace some Nvidia products. Also, Micron Technology (MU) and ARM Holdings Plc (ARM) closed down more than -1%. In addition, ASML Holding NV (ASML) closed down -0.67%, Qualcomm (QCOM) closed down -0.63%, and Applied Materials (AMAT) closed down -0.50%.
Defensive consumer staples and food makers were under pressure on Monday. Colgate-Palmolive (CL) and Kraft Heinz (KHC) closed down more than -2%. Also, Conagra Brands (CAG), J M Smucker (SJM), Keurig Dr Pepper (KDP), and the Campbell’s Company (CPB) closed down more than -1%.
Erie Indemnity (ERIE) closed down more than -4% to lead losers in the S&P 500, adding to last Friday’s -11% plunge after reporting Q1 EPS of $2.65, well below the consensus of $3.19.
Coinbase Global (COIN) closed down more than -2% after Compass Point Research double-downgraded the stock to sell from buy with a price target of $180.
Chipotle Mexican Grill (CMG) closed down more than -1% after Argus Research downgraded the stock to hold from buy.
Roper Technologies (ROP) closed down more than -1% after forecasting Q2 adjusted EPS from continuing operations $4.80 to $4.84, below the consensus of $4.87.
Earnings Reports (4/29/2025)
A O Smith Corp (AOS), Altria Group Inc (MO), American Tower Corp (AMT), Arch Capital Group Ltd (ACGL), Booking Holdings Inc (BKNG), BXP Inc (BXP), Caesars Entertainment Inc (CZR), Coca-Cola Co/The (KO), Corning Inc (GLW), CoStar Group Inc (CSGP), Ecolab Inc (ECL), Edison International (EIX), Entergy Corp (ETR), Equity Residential (EQR), Essex Property Trust Inc (ESS), Expand Energy Corp (EXE), Extra Space Storage Inc (EXR), Fair Isaac Corp (FICO), First Solar Inc (FSLR), General Motors Co (GM), Hilton Worldwide Holdings Inc (HLT), Honeywell International Inc (HON), Incyte Corp (INCY), Kraft Heinz Co/The (KHC), Labcorp Holdings Inc (LH), Mondelez International Inc (MDLZ), ONEOK Inc (OKE), PACCAR Inc (PCAR), PayPal Holdings Inc (PYPL), Pfizer Inc (PFE), PPG Industries Inc (PPG), Regency Centers Corp (REG), Regeneron Pharmaceuticals Inc (REGN), Royal Caribbean Cruises Ltd (RCL), S&P Global Inc (SPGI), Seagate Technology Holdings PL (STX), Sherwin-Williams Co/The (SHW), Starbucks Corp (SBUX), Sysco Corp (SYY), United Parcel Service Inc (UPS), Veralto Corp (VLTO), Visa Inc (V), Xylem Inc/NY (XYL), Zebra Technologies Corp (ZBRA).
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
