May 29, 2025
S&P futures are up 1.5%, driven by a wave of global optimism following Wednesday’s dip in U.S. equities. Asian markets, led by Japan, South Korea, and Hong Kong, all posted gains exceeding 1%. European indices are up approximately 0.7% in early trading. In the bond market, Treasuries weakened, with the 10-year yield rising above 4.5% and the 30-year yield surpassing 5%. The dollar index is up 0.1%, gold is down 0.6%, bitcoin futures are up 1.2%, and WTI crude is up 1.3%.
Risk assets are supported by trade-related developments as the U.S. Court of International Trade struck down certain IEEPA tariffs, including the baseline 10% tariff, the 20% incremental tariff on China, and the 25% tariff on non-USMCA imports from Mexico and Canada. Sector-specific tariffs remain unaffected. AI remains a bright spot after NVDA’s results and guidance highlighted robust demand across enterprise, industrial, and sovereign AI, despite an ~$8 billion revenue headwind from China restrictions.
On the economic front, today’s calendar features the second release of Q1 GDP, initial jobless claims, and pending home sales. A busy slate of Fedspeak is also on the agenda, including remarks from Barkin, Goolsbee, Kugler, Daly, and Logan. Yesterday’s FOMC minutes leaned hawkish, reiterating caution and emphasizing inflation risks, though they had limited impact on rate policy expectations. Treasury supply remains in focus with a $44 billion sale of 7-year notes today. Looking ahead, Friday brings personal income and spending data, including the closely watched headline and core PCE inflation figures, as well as the University of Michigan consumer sentiment survey.
- NVDA: Delivered strong Q2 guidance, offsetting concerns over lost revenue from China and reinforcing confidence in its AI growth trajectory.
- CRM: Benefited from AI and Data Cloud momentum, though faced scrutiny over a slowdown in core cloud segment growth.
- HPQ: Reported a margin-driven EPS miss and lowered FY guidance, attributing challenges to macroeconomic uncertainties.
- S: Pressured by an ARR miss, deal pushouts, and reduced guidance reflecting ongoing macro conditions.
- ELF: Posted better-than-expected fiscal Q4 results but withheld FY26 guidance while announcing a $1 billion acquisition.
- AI: Saw significant gains as positive sentiment grew around partnership momentum and expansion opportunities.
U.S. equities closed lower Wednesday, ending near session lows after a late-day selloff. The Dow fell 0.58%, the S&P 500 lost 0.56%, the Nasdaq declined 0.51%, and the Russell 2000 dropped 1.08%. Declines followed Tuesday’s strong rally, with big tech mixed, most shorted names lagging, and weakness across energy, homebuilders, airlines, regional banks, chemicals, and utilities. Outperformers included semiconductors, managed care, networking/communication, and media.
Treasuries weakened, with the curve bear steepening. The dollar index rose 0.4%, gold slipped 0.2%, Bitcoin futures fell 2.6%, and WTI crude climbed 1.6%. The session was light on major directional drivers, with focus shifting toward Nvidia’s earnings post-close. The May Richmond Fed Manufacturing Index improved month-over-month but remained in contraction, while a $70B 5-year Treasury auction showed strong demand.
The May FOMC minutes reiterated a cautious approach amid heightened uncertainty, noting potential policy tradeoffs if inflation persists while growth and employment weaken. The Fed projects slower growth for 2025 and 2026 than earlier estimates.
EU negotiators acknowledged they might need deeper concessions to prevent a full-blown trade war with the U.S., with discussions around steel, semiconductors, and critical minerals cooperation ongoing. Meanwhile, Anthropic’s CEO warned AI advancements could eliminate half of white-collar entry-level jobs within five years.
Sector Performance
- Outperformers: Real Estate (+0.02%), Communication Services (+0.17%), Tech (+0.34%), Industrials (+0.52%).
- Underperformers: Utilities (-1.44%), Materials (-1.27%), Energy (-1.25%), Consumer Discretionary (-0.94%).
Information Technology
- NVDA: Suppliers resolved AI rack issues, boosting sales prospects.
- BOX: Beat Q1 estimates and raised guidance, driven by pricing increases and early renewals (+17.2%).
- OKTA: Shares fell on soft Q2 cRPO guidance and macro uncertainty (-16.2%).
- CDNS: Declined following reports that U.S. EDA firms must halt sales to Chinese customers (-10.7%).
- SMTC: Positive AI Data Center takeaways but underwhelming Q1 results led to a 4.6% drop.
- FICO: Gained 7.7% on valuation upgrade and confidence in market positioning.
Consumer Discretionary
- ANF: Q1 beat expectations with Hollister standout, FY revenue guidance raised (+14.7%).
- MTN: Shares rose on CEO transition news (+8.7%).
- CPRI: Better Q4 revenue but weaker margins and cautious guidance; shares gained 2.8%.
- DKS: Q1 results aligned with preannouncement; FY guidance reaffirmed (+1.7%).
Industrials
- JOBY: Surged on $250M strategic investment from TM (+28.8%).
- RKLB: Announced $275M acquisition of Geost.
- PLAB: Declined after weak Q2 results and CEO transition (-15.6%).
Financials
- FNMA: Gained following Trump’s comments about a public offering while retaining U.S. guarantees (+2.2%).
- CODI: Dropped sharply on irregularities at subsidiary Lugano and suspension of dividends (-12.2%).
Healthcare
- MBLY: Up 3.6% after announcing an imaging radar deal for “eyes-off” driving.
Energy
- Chevron: CEO stated no shift in investment strategy even if oil prices drop to $50/barrel.
Eco Data Releases | Thursday May 29th, 2025
S&P 500 Constituent Earnings Announcements | Thursday May 29th, 2025
Data sourced from FactSet Research Systems Inc.
