Like on Monday, stock futures were extremely volatile. After reports broke that the U.S. and China were set to resume trade talks soon, Dow Jones Industrial Average futures soared by 292 points, roughly 0.7%. Whether the market can maintain this positive momentum in the wake of continued shake-up in the markets remains to be seen. The overall market did face some challenges. The S&P 500 index lost about 0.8%, and the Nasdaq Composite index declined about 0.9%.
On the last trading day, the Dow had already taken a beating of almost 390 points, or 1%. This was compounded by a host of companies reporting mixed or negative earnings surprises. Not surprisingly, Wynn Resorts attributed a 2% drop in shares to the company’s weaker-than-expected first-quarter earnings. Advanced Micro Devices (AMD) followed, climbing almost 4%. That jump came on the heels of a much better-than-expected earnings report for that same quarter. This divergence in performance is a testament, perhaps, to the confused state of mind among investors about the future trajectory of corporate profitability.
Super Micro Computer has had a wild ride lately. Its shares plunged about 5% per share after the company missed Wall Street’s expectations for the fiscal Q3 and released a grim forecast. These changes paired to make the short-term market an especially conservative locale. Investors found it hard to wrap their heads around what moving corporate earnings meant.
This week’s stock-futures rally accelerated after rumors of a key meeting among U.S. government officials was confirmed to be in the works. U.S. Treasury Secretary Scott Bessent and the Administration’s top trade official, Jamieson Greer will meet with their Chinese counterparts later this week in Switzerland. This announcement provided some relief to jittery investors worried about continued trade spats between the two global juggernauts.
This optimism was undercut by continued worries about the U.S. economy’s possible descent into recession. Recent upheaval in financial markets have amplified these fears, making many investors fearful of what’s to come. Stock futures fell initially shortly after 6 p.m. ET. Futures on both the Dow and S&P 500 fell by 0.2%. At the same time, Nasdaq 100 futures retreated 0.3%, showing the general risk-averse tone across the markets.
With all the chaos in the stock market. This all is happening against the backdrop of former President Donald Trump criticizing Federal Reserve Chair Jerome Powell, claiming his “termination cannot come fast enough.” Despite this rhetoric, sources indicate that Trump has no intention of removing Powell from his position at the Federal Reserve.
Investors are preparing for some more economic data releases this week, with consumer credit data due out on Wednesday being in particular focus. New information coming on that front should provide more insight into consumer spending trends. It might show the state of the broader economy, which could drive overall market sentiment.