📆 Friday, May 2
► European stocks rose after the holiday, with the Stoxx 600 trading a little over 1% higher and pointing to a potential a ninth straight day of gains – which would be the longest winning streak in nearly a year. Optimism was fueled by news that China was evaluating US proposals to resume trade talks, boosting hopes that tariff tensions had peaked. Eurozone and German manufacturing PMIs edged higher, signaling stabilization despite remaining below 50 (contraction territory). Strong earnings from ING, Airbus, and Shell also supported sentiment after mixed earnings reports yesterday (after the bell) from US tech/growth incl. tech giants Amazon and Apple. Eurozone inflation rate was reported above expectations with in particular core inflation rising significantly back to 2.7% YoY (up from 2.4% in March and vs. 2.5% expected).
► US equity futures recovered strongly from heavy after-hours losses with now potentially extending the S&P 500’s eight-day rally – the longest since August – as optimism over trade de-escalation grew. However, after-hours declines in Apple (- 3.2%) and Amazon (- 1.4%) tempered enthusiasm, following weaker China sales and a soft profit outlook, respectively. Also some other prominent names – such AirBnB (- 5.6%), Atlassian (- 16%), Block (- 22%) fell sharply post earnings reports. Chevron also fell more than 2.5% post earnings (today) while ExxonMobil (+0.8%) was able to rise after beating expectations. Investors remained focused on the April non-farm payrolls report, expected to provide crucial clues on the Fed’s rate trajectory. The USD weakened significantly while 10-year Treasury yields held steady.
► Asian markets rallied, reflecting global risk appetite. The Japanese Nikkei rose by 1%, while the JPY initially fell significantly due to trade optimism and the Bank of Japan's cautious stance, but then moved back below 145/USD. The BOJ held rates at 0.5% and trimmed growth forecasts. Hong Kong’s Hang Seng rose 1.74%, while Australia's ASX climbed 1.13%, despite pressure on mining stocks, as retail sales and producer prices surprised to the upside. The offshore CNY strengthened after China’s Commerce Ministry confirmed evaluating US trade overtures, though Beijing maintained demands for Washington to remove unilateral tariffs as a condition for talks.
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