The S&P 500 Index ($SPX) (SPY) has risen +3.14%, the Dow Jones Industrials Index ($DOWI) (DIA) is up +2.57%, and the Nasdaq 100 Index ($IUXX) (QQQ) is up +3.74%. Additionally, June E-mini S&P futures (ESM25) gained +3.08%, while June E-mini Nasdaq futures (NQM25) increased by +3.63%.

The upward momentum in stock indexes continues for the second consecutive session, with the S&P 500 hitting a two-week high and the Nasdaq 100 reaching a one-week high. Investor confidence surged after President Trump expressed his intention to retain Fed Chair Powell, alleviating concerns about potential turmoil in monetary policy. This statement has bolstered the dollar and decreased the likelihood of foreign investors liquidating their dollar-based assets, including stocks and Treasuries. Furthermore, there is renewed hope for better trade relations with China, as Trump indicated he plans to adopt a friendly stance in upcoming negotiations, suggesting that tariffs may decrease if a trade deal is achieved.

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In economic data, applications for U.S. mortgages dropped by -12.7% for the week ending April 18. The purchase mortgage sub-index fell -6.6%, and refinancing applications declined -20.0%. The average rate for a 30-year fixed mortgage rose +9 basis points, now at 6.90% compared to 6.81% the previous week.

Fed Governor Kugler’s comments on Tuesday evening had a negative impact on stocks. Kugler warned that tariffs could exert upward pressure on prices and create a larger economic impact than previously anticipated. She also advocated for maintaining interest rates until inflation risks subside.

Bitcoin (^BTCUSD) surged over +2% today, reaching a seven-week high, as the dollar plunged to a three-year low, which sparked increased demand for cryptocurrencies as a safe-haven asset. Global trade tensions are further driving this shift toward cryptocurrencies.

Currently, the markets place an 11% probability on a -25 basis point interest rate cut following the May 6-7 FOMC meeting.

This week’s highlights include key corporate earnings results and developments in U.S. trade policies. March new home sales are projected to increase by +0.7% month-over-month to 681,000 units. Additionally, the Fed’s Beige Book will be published later today. On Thursday, the capital goods new orders report (excluding defense, aircraft, and parts) for March is expected to show a +0.1% increase month-over-month. However, March existing home sales are anticipated to decrease by -2.8% month-over-month, down to 4.14 million units. Finally, Friday’s revised University of Michigan consumer sentiment index for April is expected to remain unchanged at 50.8.

As we delve into Q1 earnings, data from Bloomberg Intelligence indicates that the consensus for year-over-year earnings growth for S&P 500 companies is now +6.7%, a drop from earlier expectations of +11.1% from November. Looking ahead, S&P 500 corporate profits for the entirety of 2025 are projected to rise by +9.4%, compared to a previous forecast of +12.5% set in January.

Internationally, stock markets exhibited mixed results today. The Euro Stoxx 50 achieved a two-and-a-half week high, rising by +2.36%. Conversely, China’s Shanghai Composite dipped by -0.10%, while Japan’s Nikkei Stock 225 jumped to a three-week high, closing up +1.89%.

Interest Rates

June 10-year T-notes (ZNM25) increased by +14 ticks, with the 10-year T-note yield declining by -11.3 basis points to 4.288%. T-note prices rose today after President Trump reassured markets about Fed Chair Powell’s position, which mitigated fears over the Fed’s independence potentially triggering foreign sales of dollar assets, including Treasuries.

An increase in inflation expectations is contributing to pressures on T-notes, as indicated by the 10-year breakeven inflation rate reaching a one-and-a-half week high of 2.302%. Additionally, impending supply pressures from Treasury auctions may weigh on prices, with $30 billion of 2-year floating-rate notes and $70 billion of 5-year T-notes set to be auctioned later today, part of a $213 billion auction package this week.

European government bond yields displayed mixed movements today. The yield on 10-year German bunds increased by +2.3 basis points to 2.467%, while the 10-year UK gilt yield fell to a two-week low of 4.469%, declining -5.6 basis points.

The April S&P manufacturing PMI for the Eurozone unexpectedly rose by +0.1 to a two-and-a-quarter year high of 48.7, surpassing expectations of a decline to 47.4. However, the April S&P composite PMI fell by -0.8 to 50.1, falling short of the anticipated figure of 50.2.

ECB Governing Council member and Bundesbank President Nagel warned of Europe’s stagnating situation due to the fallout from U.S. tariffs and cited a “risk of recession for Germany.” Current swaps suggest a 93% likelihood of a -25 basis point rate cut by the ECB during the policy meeting on June 5.

U.S. Stock Movers

Stocks from the so-called Magnificent Seven are making notable gains, with Amazon.com (AMZN) up over +7%, and Meta Platforms (META) rising more than +6%. Nvidia (NVDA) has increased by more than +4%, and Tesla (TSLA), Apple (AAPL), Alphabet (GOOGL), and Microsoft (MSFT) are all up more than +3%.

Chip stocks are surging due to an easing of U.S.-China trade tensions; President Trump indicated that tariffs on China could decrease if negotiations progress. Consequently, Marvell Technology (MRVL) is up more than +8%, while Advanced Micro Devices (AMD), ARM Holdings Plc (ARM), and GlobalFoundries (GFS) are up over +7%. Additional gainers include Micron Technology (MU), Microchip Technology (MCHP), and Lam Research (LRCX), all rising more than +5%, along with KLA Corp (KLAC), NXP Semiconductors NV (NXPI), Analog Devices (ADI), and Texas Instruments (TXN), which are up more than +4%.

Cryptocurrency-related stocks have also risen as Bitcoin climbs over +2% to a seven-week high. Riot Platforms (RIOT) is showing an increase of more than +7%, while Coinbase Global (COIN) is up more than +5%. Meanwhile, MARA Holdings (MARA) is gaining more than +3%, and MicroStrategy (MSTR) has gone up over +2%.

Amphenol Corp (APH) is soaring by more than +13% after reporting Q1 net sales of $4.80 billion, exceeding the consensus estimate of $4.25 billion.

Boeing (BA) is up more than +7% as it leads gains in the Dow Jones Industrials after announcing Q1 revenue of $19.50 billion, which was better than the anticipated $19.37 billion.

Boston Scientific (BSX) saw a rise of more than +7% following a revision of its full-year net sales forecast to +15% to +17%, adjusted from a previous view of +12.5% to +14.5%.

Lastly, Vertiv Holdings (VRT) is up more than +16% after increasing its full-year net sales forecast to between $9.33 billion and $9.58 billion, well above the consensus prediction of $9.20 billion. Intel (INTC) climbed more than +6% after reports emerged about the company’s plans to cut over 20% of its workforce to optimize operations. Phillip Morris (PM) is seeing an uptick of more than +2% after announcing Q1 adjusted EPS of $1.69, exceeding the consensus estimate of $1.61, along with a revised full-year adjusted EPS outlook.