Stock Rally Stalls Ahead of Big-Tech Earnings, Fed: Markets Wrap
(Bloomberg) — The record-breaking stocks rally faltered as investors awaited results from US technology giants as well as a Federal Reserve policy decision.
Futures on the S&P 500 were flat after the gauge hit an all-time high as Chinese and US trade negotiators lined up an array of diplomatic wins for Donald Trump and Xi Jinping to unveil at a summit this week.
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Easing trade tensions have helped fuel the stock rally, with US companies largely unscathed by tariffs so far. The S&P 500 is on course to have the most firms delivering sales beats in about four years. That optimism faces a reality check this week as investors look to the Fed meeting for clues on the path of rate cuts, while major technology firms including Meta Platforms Inc. and Microsoft Corp. reveal whether the artificial intelligence-fueled earnings momentum can be sustained.
“While signs of frothiness are emerging in equity markets, we view this as late-cycle behavior rather than a sign of an impending recession, as corporate fundamentals are still solid,” said Patrick Brenner, multi-asset chief investment officer at Schroder Investment Management. “We maintain our long position in equities” as “corporate earnings remain supportive,” he said.
The Stoxx Europe 600 index retreated from a record close, with basic resources stocks leading declines as crude oil fell along with gold and silver.
Among individual movers in Europe, Novartis AG dropped after the Swiss pharmaceuticals company missed analysts’ earnings estimates. BNP Paribas SA fell after its trading unit suffered a hit from souring debt, with loan-loss provisions rising.
Lender HSBC Holdings Plc gained after lifting its profit outlook, while French technology-services firm Capgemini SE and Spanish energy company Iberdrola SA advanced on earnings beats. German wind-turbine maker Nordex SE surged more than 10% after a guidance raise.
Meanwhile, the yen gained against the dollar after US Treasury Secretary Scott Bessent and newly appointed Japanese Finance Minister Satsuki Katayama discussed exchange rate volatility. The Bloomberg Dollar Spot index edged lower for a second day, and Treasury yields were steady.
China’s yuan climbed to its strongest level in nearly a year, amid optimism over a potential China-US trade deal. Gold held below $4,000 an ounce as progress in trade talks sapped demand for haven assets.
On Wednesday and Thursday, five firms that account for about a quarter of the US benchmark — Microsoft Corp., Alphabet Inc., Meta Platforms Inc., Amazon.com and Apple Inc. — will report results. A gauge of the “Magnificent Seven” megacaps jumped 2.6% on Monday.
“With the Fed on track to cut rates, extending the run would appear to hinge on this week’s lineup of high-profile earnings releases,” said Chris Larkin at E*Trade from Morgan Stanley.
Copper — a bellwether for global growth — advanced and traded roughly $60 shy of a record set last year as investors assessed the cooling of trade tensions between the US and China.
Corporate News:
Amazon.com Inc. plans to cut 14,000 jobs as it adjusts to the the changing business environment brought aboiut by AI. Amundi SA reported adjusted pretax income for the third quarter that beat analysts’ estimates as the French asset manager prepares to unveil its new three-year strategic plan next month. Nvidia Corp. and Deutsche Telekom AG are preparing to announce plans for a €1 billion data center in Germany. BlackLine Inc. has attracted takeover interest from suitors including SAP SE, according to people with knowledge of the matter. Nomura Holdings Inc.’s profit beat analysts’ expectations last quarter, buoyed by equity trading and advising on mergers. Danone SA sales rose as the French foodmaker benefited from momentum in Asia and growing demand for high-protein products. ING Groep NV has estimated that around 950 positions are at risk in the Netherlands by the end of 2026 as the lender continues restructuring and the roll-out of artificial intelligence. Some of the main moves in markets:
Stocks
S&P 500 futures were little changed as of 5:44 a.m. New York time Nasdaq 100 futures were little changed Futures on the Dow Jones Industrial Average were little changed The Stoxx Europe 600 fell 0.3% The MSCI World Index was little changed Currencies
The Bloomberg Dollar Spot Index fell 0.1% The euro rose 0.1% to $1.1657 The British pound fell 0.2% to $1.3315 The Japanese yen rose 0.6% to 151.92 per dollar Cryptocurrencies
Bitcoin was little changed at $114,481.01 Ether fell 0.2% to $4,122.49 Bonds
The yield on 10-year Treasuries was little changed at 3.97% Germany’s 10-year yield was little changed at 2.61% Britain’s 10-year yield declined three basis points to 4.37% Commodities
West Texas Intermediate crude fell 1.8% to $60.19 a barrel Spot gold fell 1.8% to $3,910.14 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Michael Msika and Anand Krishnamoorthy.
©2025 Bloomberg L.P.
