Stocks set to rebound on Tariff Delay 27/05/2025

HOT stories for today

US market wrap:

• Stocks stumbled Friday afternoon, with shares of Apple and Nike sliding into the red and dragging the Dow Jones Industrial Average lower. The blue-chip index was recently down 155 points, or 0.4%, weighed down by a 3.02% decline in Apple (AAPL) and a 2.12% drop in Nike (NKE). Combined, the two stocks shaved approximately 38 points off the Dow’s value.
• The market downturn followed an atypical end-of-week social media barrage from former President Donald Trump, who hinted at sweeping new tariffs, including a potential 50% levy on goods from the European Union. He also suggested Apple would face added costs if it intends to manufacture iPhones in India. Despite the negative tone, Trump also made headlines by greenlighting the U.S. Steel acquisition and authorizing a nuclear energy directive aimed at powering the rapidly expanding AI sector—sending nuclear-related stocks soaring.  U.S. markets were closed Monday in observance of Memorial Day.

Stocks set to rebound on Tariff Delay

• After a bruising Friday, U.S. markets are eyeing a strong comeback, with stock futures climbing ahead of Tuesday’s open. The rally comes on the heels of President Donald Trump postponing a planned 50% tariff hike on European Union imports, pushing the deadline to July 9 to allow more time for negotiations. Investor sentiment was buoyed by comments from the EU’s chief trade negotiator, who said Monday that he had held “good calls” with the Trump administration and affirmed the bloc’s commitment to reaching a deal before the new deadline.
• Despite the optimism, economists are urging caution. Holger Schmieding, chief economist at Berenberg, told CNBC that even a compromise reducing tariffs to 20% or 30% could still provoke a backlash. “The EU would have no choice,” he warned, “but to implement significant countermeasures” in response to any unilateral U.S. action. Markets had closed lower last week, rattled by trade tensions and political unpredictability. Now, with negotiations back on the table—at least temporarily—investors appear ready to reengage, though the path forward remains uncertain.

Stocks on the move:

• Intuit (INTU) — Shares of the financial software firm, which owns TurboTax and QuickBooks, surged 7.5% following upbeat quarterly earnings. Intuit reported a 15% year-over-year revenue increase in its fiscal third quarter, reaching $7.8 billion.
• Apple (AAPL) — The tech heavyweight's stock declined 2.6% after former President Donald Trump warned that Apple could face tariffs of 25% or more on iPhones produced abroad. While Apple manufactures most of its iPhones in China, it has been gradually relocating production to India amid escalating trade tensions.
• Nuclear Energy Stocks — Equities linked to the nuclear sector rallied on reports from Reuters that Trump is expected to sign executive orders promoting nuclear power, potentially as soon as Friday. Oklo (OKLO) jumped 24%, NuScale (SMR) climbed 14.5%, Cameco (CCJ) advanced 9%, and Constellation Energy (CEG) gained 2.8%.
• Ross Stores (ROST) — Shares of the discount retailer plunged 11% after the company retracted its full-year guidance, citing tariff-related uncertainty. Additionally, Ross issued second-quarter earnings projections that fell short of analyst estimates.

Today’s action

• Asia-Pacific equities mostly declined Tuesday as investors digested ongoing trade tensions following U.S. President Donald Trump's decision to postpone a proposed 50% tariff on European Union imports. Japan’s Nikkei 225 slipped 0.19%, while mainland China’s CSI 300 dropped 0.56% amid volatile trading. Hong Kong’s Hang Seng Index also edged down 0.3%. On a brighter note, China reported a 1.4% rise in industrial profits for April, improving from March’s 0.8% increase.
• Meanwhile, U.S. stock futures surged in early Tuesday action. The Dow Jones Industrial Average (DJIA) futures advanced 0.85%. S&P 500 (SPX) futures rose 0.89%, and Nasdaq 100 (NDX) futures gained 0.92%, as investors responded positively to the holiday weekend news that Trump would delay EU tariff hikes. Market participants are now turning their attention to key U.S. economic indicators due Tuesday, including reports on durable goods orders, housing activity, and consumer confidence. Commentary from Minneapolis Fed President Neel Kashkari and New York Fed President John Williams is also on the radar. On the corporate front, Okta (OKTA) is scheduled to report earnings after the closing bell, followed by updates from Nvidia (NVDA), Macy’s (M), and Costco (COST) later in the week.

Watchlist: OKTA, CCJ, AAPL, PDD, AZO, NVDA, OKTA

Bitcoin

• Bitcoin’s rally hit a speed bump, hovering just under the $110,000 mark as investors await key U.S. inflation data and brace for Nvidia’s earnings, which could sway broader risk sentiment. Despite macroeconomic uncertainty, institutional appetite for BTC remains strong. Bitcoin briefly touched $110K but failed to sustain the level after U.S. President Donald Trump delayed his proposed 50% tariffs on European Union imports—a move that lifted European equities but didn’t translate into new crypto highs.
• Still, solid inflows into spot Bitcoin ETFs and steady options market activity suggest institutional players are unfazed. Even a potential dip to $105,000 isn’t rattling bullish traders, who appear well-positioned and not excessively leveraged, signaling confidence in the long-term upside.
  Watchlist: Bitcoin: 74 000-111 500, Ethereum:1500-2800, Solana: 80-183

Forex

• The EUR/USD pair advanced to around 1.1395 in early Tuesday Asian trade, marking its highest level since late April. The euro strengthened after U.S. President Donald Trump postponed his planned 50% tariffs on EU imports, easing trade tensions and pressuring the U.S. dollar. Adding to the dollar’s weakness are growing concerns over the ballooning U.S. fiscal deficit. Traders now await the U.S. Conference Board’s Consumer Confidence data due later in the day for further direction.
• Meanwhile, the Japanese yen (JPY) gained ground after stronger-than-expected Japan Services PPI data bolstered speculation of a potential rate hike by the Bank of Japan. The USD/JPY pair pulled back slightly from over a one-month low, as dovish Fed expectations and geopolitical risks continued to weigh on the greenback. While Trump’s tariff extension initially cooled safe-haven demand, lingering global uncertainties kept the yen supported.
  Watchlist: EUR/USD: 1.0700-1.1600, USD/JPY: 140-151

Basic Materials
 

• West Texas Intermediate (WTI) crude is steady around $61.25 in early Tuesday Asian trade, as oil markets brace for the rescheduled OPEC+ meeting now set for May 31. Sentiment is buoyed by U.S. President Donald Trump’s decision to postpone steep tariffs on European Union imports, which has eased global trade concerns and helped support crude prices.
• Meanwhile, gold (XAU/USD) remains rangebound, trading sideways as conflicting factors keep investors on the sidelines. Optimism over the EU tariff delay has dampened safe-haven demand, capping gold’s upside. However, lingering uncertainty over U.S. trade policy, Federal Reserve rate cut expectations, fiscal concerns, and a weaker U.S. dollar continue to offer some support.
  Watchlist: GOLD 2600-3500, US Oil: 55.60-70.00
  
   

Key Economic Events Today:

EST time
08:30 am: USD Core Durable Goods Orders
09:00 am: USD HPI monthly
10:00 am: USD  CB Consumer Confidence
08:00 pm: USD FOMC Member Williams Speaks


Earnings

BMO (Before the US Market opens)
PDD              PDD Holdings Inc.
AZO              AutoZone Inc.
BNS              Bank of Nova Scotia
AMC (After the US Market closes): OKTA, SQM, BOKSZ

 

The TEFS Analyst team wishes you a successful day!