📆 Tuesday, May 6
► European markets trade significantly lower as investors assessed corporate earnings and fresh economic data. The Stoxx 600 slipped over 0.7%, halting its recent streak amid profit-taking and cautious sentiment ahead of the Federal Reserve’s policy decision as we expected. The big loser is Germany’s DAX which fell 1.7%, snapping nine days of gains as its service sector slipped back into contraction. France’s CAC 40 dipped more than 0.8%, while the UK’s FTSE 100 fell about 0.2%. Political uncertainty in Germany has further unsettled the markets after the conservative party leader Friedrich Merz was not elected Federal Chancellor in the first round of voting despite a theoretical majority of votes from the CDU/CSU and SPD parliamentary groups. A first in the history of the Federal Republic and a very bad day / “start” for the upcoming government. A second round of voting is expected to take place tomorrow.
► US equity futures edged lower as the S&P 500 longest rally in two decades lost steam amid renewed trade uncertainty and mixed earnings. SmartTrader chief analyst Robert Lindner had predicted this, as many of the positive developments that had been priced in did not (yet) materialize – including the trade agreements that investors had expected. S&P 500 futures slipped over 0.65% after the index stalled Monday. While President Trump hinted (again) that trade deals with unnamed countries could arrive soon, no progress was seen with China or the EU. Investors also digested corporate news like, weak forward guidance from Ford and disappointing results from Palantir. Apple raised $4.5 billion through its first bond sale in two years, with strong demand noted. Traders shifted focus to Wednesday’s Fed decision, with markets expecting rates to remain unchanged despite pressure from tariffs and political risks.
► Asian markets traded mixed as ongoing hopes for US-China trade talks offset concerns over fresh tariff threats and slowing regional data. Hong Kong’s Hang Seng gained 0.7%, supported by a positive Q1 GDP report. China’s Shanghai composite rose 1.13%, rebounding after the holiday despite weaker services PMI readings. The offshore CNY weakened to around 7.23 per USD. The Chinese markets continue to outperform. Australia’s ASX 200 hovered flat after earlier losses, while the AUD slipped from recent highs.
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