Stock Market Wrap-up, May 9, 2025: Shares Stand Still as Traders Ponder US-China Trade Negotiations Results; Significant Weekly Declines Registered on Main Indices
Markets Cling to Yesterday's Success as Investors Anticipate Trade Talks
Stocks struggled to hold onto their gains from yesterday, as the S&P 500, Dow Jones, and Nasdaq Composite stumbled slightly. Yet, the tech-heavy Nasdaq still managed to eke out a small positive close. The up-and-down trading session came as investors kept one eye on highly anticipated trade talks, scheduled for this weekend in Switzerland between U.S. and Chinese authorities.
President Trump indicated yesterday that the talks could be "substantive" and that tariffs, now at whopping levels, could potentially decrease if negotiations go well. This has left investors in a holding pattern, waiting for news from the discussions.
Meanwhile, several Federal Reserve officials spoke at various events, with the Fed's policy committee opting to keep interest rates unchanged on Wednesday. While this decision likely pleased President Trump, Chair Jerome Powell maintained that tariffs have increased the risk of higher inflation and unemployment. Nevertheless, the Fed wants more data on the impact of trade policy on the economy before making adjustments to monetary policy.
In the tech sector, shares of Tesla, Microsoft, Apple, Amazon, and Broadcom inched higher, while Nvidia, Alphabet, and Meta Platforms experienced marginal declines. Mega-cap tech stocks have been a wellspring of optimism for investors in recent weeks.
Bitcoin, which breached the $100,000 mark for the first time since February yesterday, managed to maintain its momentum, hovering around $103,000 in late trading. The digital currency's recent surge has been driven by optimism about potential trade agreements and a lessening of tariff-related uncertainty.
Despite this, some opportunities still lurked on the earnings reporting calendar, with a handful of companies making big moves after announcing quarterly results. Pinterest and cybersecurity provider Cloudflare posted impressive gains, whereas travel booking service Expedia struggled after delivering disappointing results and revising its full-year outlook.
Back in the cryptocurrency realm, Affirm's stock took a tumble after issuing a lackluster current-quarter revenue outlook. Investors were also watching Tesla's progress on its plans for self-driving robotaxis, as the electric vehicle manufacturer looks to roll out the innovative feature by the end of next month.
Biggest S&P 500 Movers
- Akamai Technologies shares tumbled after Scotiabank reduced its price target on the cybersecurity and cloud computing company.
- Expedia Group shares plummeted following the travel booking service's less-than-expected first-quarter results and reduced full-year outlook due to weak U.S. travel demand.
- CEO Ariane Gorin reported that the company managed to grow bookings and revenue "despite weaker-than-expected demand in the U.S."
- TKO Group Holdings fell following its earnings miss and the company's subsequent decision to lift its full-year revenue forecast.
Advancers
- Shares of insulin pump maker Insulet skyrocketed after its stronger-than-expected quarterly results and revised full-year revenue outlook.
- Microchip Technology jumped after several analysts raised their price targets due to the chipmaker's improved outlook.
- Tesla shares surged for the third consecutive week amid optimism about new U.S. trade deals.
Sources: Reuters, CNBC, MarketWatch
[1] Lam, S., Trade talks between US and China could be ‘very substantive,’ White House press secretary says
[2] McKay, E., What to expect as US and China resume trade talks in Geneva
[3] Barboza, D., These Are the Potential Outcomes of Trump's Next Round of China Trade Talks
[4] Federal Reserve's rate decision, explained
[5] Trade talks: Beijing and Washington spar as US imposes new tariffs
- The trading session on Wednesday saw stocks holding onto their gains from the previous day with a slight struggle, as the S&P 500, Dow Jones, and Nasdaq Composite slipped mildly, while the tech-heavy Nasdaq still managed a small positive close.
- In anticipation of trade talks scheduled for this weekend in Switzerland between U.S. and Chinese authorities, investors find themselves in a holding pattern, waiting for news from the discussions.
- President Trump indicated that the talks could be "substantive" and potentially lower tariffs if negotiations go well.
- The Federal Reserve's policy committee decided to keep interest rates unchanged on Wednesday, a move that pleased President Trump, but Chair Jerome Powell emphasized that tariffs have increased the risk of higher inflation and unemployment.
- In the tech sector, Tesla, Microsoft, Apple, Amazon, and Broadcom inched higher, while Nvidia, Alphabet, and Meta Platforms experienced marginal declines.
- Bitcoin, now hovering around $103,000, managed to maintain its momentum after breaching the $100,000 mark for the first time since February due to optimism about potential trade agreements and lessening tariff-related uncertainty.
- Some companies reported significant moves on the earnings reporting calendar, with Pinterest and cybersecurity provider Cloudflare posting impressive gains, whereas travel booking service Expedia struggled after delivering disappointing results and revising its full-year outlook.
- In the realm of cryptocurrency, Affirm's stock tumbled after issuing a lackluster current-quarter revenue outlook, while investors paid attention to Tesla's progress on its plans for self-driving robotaxis.
