The S&P 500 Index ($SPX) (SPY) is down -0.30% today, while the Dow Jones Industrial Average ($DOWI) (DIA) has fallen -0.55%. The Nasdaq 100 Index ($IUXX) (QQQ) is also down, recording a -0.26% decline. Additionally, June E-mini S&P futures (ESM25) have decreased by -0.25%, and June E-mini Nasdaq futures (NQM25) are down -0.21%.

Stock indexes are facing pressure due to mixed signals from China and varied corporate earnings results. According to Bloomberg, the Chinese government is contemplating the suspension of a 125% tariff on specific US imports, such as medical equipment and industrial chemicals like ethane. However, Chinese Foreign Ministry spokesman Guo Jiakun emphasized that China is not currently in negotiations regarding tariffs and urged the US not to mislead the public.

Corporate Earnings Reports Reflect Mixed Results

The latest corporate earnings results display a mixed landscape. Intel shares plummeted more than -8% after releasing a forecast that fell short of market expectations. T-Mobile US is down by over -8% as well, citing fewer new mobile phone subscribers than anticipated for Q1. Eastman Chemical also reported disappointing results, falling more than -4% after projecting Q2 adjusted EPS below consensus due to “tariffs between the US and China.” On a brighter note, Alphabet shares are up by more than +1% after releasing Q1 revenue and profit that surpassed expectations.

Foreign Investment Trends Impact US Equities

Goldman Sachs reported today that foreign investors have sold $63 billion of US equities since March 1. This trend poses a notable risk to equity valuations, as foreign investors began 2025 with a record 18% ownership share of US equities.

Currently, the markets are pricing in an 8% likelihood of a -25 basis point rate cut following the upcoming FOMC meeting on May 6-7.

Focus on Corporate Earnings and Trade Policies This Week

This week’s market attention will center on the ongoing Q1 corporate earnings results and any potential changes to US trade policies. Today, the revised University of Michigan April consumer sentiment index is expected to remain unchanged at 50.8.

The Q1 earnings season is underway. Data from Bloomberg Intelligence indicates the consensus for S&P 500 companies is a +6.7% year-over-year earnings growth for Q1, down from +11.1% anticipated in early November. Projections for full-year 2025 corporate profits have also decreased, now estimated to rise +9.4%, down from the earlier forecast of +12.5% in January.

International Markets Exhibit Mixed Performance

International equity markets reflect a mixed trend today. The Euro Stoxx 50 index has reached a three-week high, climbing +0.74%. Conversely, China’s Shanghai Composite edged down by -0.07%. Japan’s Nikkei 225 index rose to a three-and-a-half week high, closing up +1.90%.

Interest Rates and Bond Yields

June 10-year T-notes (ZNM25) have shown an increase of +6 ticks, with the 10-year T-note yield down by -4.5 basis points, now at 4.270%. The upward movement in T-notes follows support from prior dovish comments by Federal Reserve officials, with Cleveland Fed President Hammack noting that evident data could prompt a June rate cut, while Fed Governor Waller expressed support for rate cuts if tariffs resulted in job losses. Additionally, short covering is aiding T-notes as bond dealers unwind short hedges established during the week’s $213 billion Treasury auctions.

European government bond yields are mixed. The 10-year German bund yield is up +1.8 basis points to 2.466%, while the 10-year UK gilt yield has decreased by -1.7 basis points to 4.484%. Notably, UK retail sales, excluding auto fuel, unexpectedly rose by +0.5% month-over-month, contrasting with forecasts of a -0.5% decline.

ECB Governing Council member Holzmann remarked that the overall impact from US tariff announcements appears primarily deflationary rather than inflationary, with swaps reflecting a 100% probability for a -25 basis point rate cut at the ECB’s policy meeting on June 5.

Movements in US Stocks

Intel (INTC) is leading the losses in the chip sector, down more than -8% following a weaker than expected Q2 revenue forecast of $11.2 billion to $12.4 billion, falling short of the consensus of $12.88 billion. Other semiconductor companies such as Advanced Micro Devices (AMD), Analog Devices (ADI), ON Semiconductor Corp (ON), ASML Holding NV (ASML), Microchip Technology (MCHP), NXP Semiconductors NV (NXPI), and GlobalFoundries (GFS) are also down by more than -1%.

T-Mobile US (TMUS) is down over -8%, leading the Nasdaq 100 losers after reporting only 495,000 new mobile phone subscribers in Q1 against the consensus estimate of 507,000.

Aon Plc (AON) saw a decline of more than -6% after reporting Q1 revenue of $4.70 billion, which was below the consensus of $4.83 billion.

Skechers USA (SKX) dropped more than -4% as it refrained from providing guidance and withdrew its previous annual outlook due to macroeconomic uncertainties. Meanwhile, Eastman Chemical (EMN) fell over -4%, forecasting Q2 adjusted EPS between $1.70-$1.90, below the consensus of $2.20, attributing challenges to tariffs between the US and China. Gilead Sciences (GILD) also reported a decline of more than -3% after recording Q1 revenue that came in at $6.67 billion, below the consensus prediction of $6.79 billion.

Conversely, Charter Communications (CHTR) surged more than +8%, leading gains in both the S&P 500 and Nasdaq 100 after posting Q1 adjusted EBITDA of $5.80 billion, outperforming the consensus estimate of $5.57 billion.

Alphabet (GOOGL) saw an increase of over +1%, following its report of Q1 revenue ex-TAC at $76.49 billion, exceeding the consensus estimate of $75.4 billion.

VeriSign (VRSN) advanced more than +5% after announcing a +6.3% year-over-year rise in Q1 domain registrations to 10.1 million. Digital Realty Trust (DLR) also gained over +5%, reporting Q1 core FFO/share of $1.77, which surpassed the consensus of $1.71. Additionally, Caesars Entertainment (CZR) rose more than +3% after Texas Capital initiated coverage with a buy recommendation and a price target of $59.

Charles Schwab (SCHW) increased by over +1% after Goldman Sachs raised its rating on the stock from neutral to buy, setting a price target of $100.

Earnings Reports Scheduled for April 25, 2025

Upcoming earnings reports include AbbVie Inc (ABBV), Aon PLC (AON), Centene Corp (CNC), Charter Communications Inc (CHTR), Colgate-Palmolive Co (CL), HCA Healthcare Inc (HCA), LyondellBasell Industries NV (LYB), Phillips 66 (PSX), and Schlumberger NV (SLB).

On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are intended solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.

The opinions expressed herein represent the views of the author and do not necessarily reflect those of Nasdaq, Inc.