Market Watch: Stocks Poised for Rebound as Fed Decision Looms and US-China Trade Talks Advance
Major Indexes Set to Recover After Two-Day Slide
The U.S. stock market is showing signs of recovery in early trading on Wednesday, May 7, 2025, after two consecutive days of losses. Futures on the Dow Jones Industrial Average are up 280 points, while those on the S&P 500 and Nasdaq are up 50 points and 200 points respectively.
Market sentiment appears to be improving on news that U.S. Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer will travel to Switzerland later this week for trade talks with China led by Vice Premier He Lifeng. This marks the first confirmed trade negotiations between the countries since President Trump announced sweeping tariffs last month.
All Eyes on Today’s Federal Reserve Decision
The Federal Reserve’s interest rate decision, scheduled for release at 2 p.m. ET today, stands as the most anticipated market event. Fed Chair Jerome Powell’s press conference will follow at 2:30 p.m.
Market analysts expect the Fed to maintain current interest rates while providing guidance on how the recent tariff announcements might influence future decisions. The central bank’s commentary on inflation and economic growth will be particularly scrutinized in light of the evolving trade situation.
Major Earnings Releases Driving Individual Stock Movements
Several high-profile companies are reporting earnings today, potentially moving markets. Uber Technologies (UBER) is expected to report a 259.38% increase in earnings per share compared to the same quarter last year. Walt Disney Company (DIS) is reporting with analysts forecasting a slight 2.48% decrease in earnings compared to last year.
Other notable companies releasing earnings today include Emerson Electric (EMR), Johnson Controls (JCI), Barrick Gold (GOLD), and Novo Nordisk (NVO). Novo Nordisk has already reported better-than-expected profits but lowered its full-year sales growth forecast amid weaker sales of its blockbuster Wegovy weight loss drugs.
Corporate News and Stock Movements to Watch
DoorDash (DASH) has agreed to acquire UK-based food-delivery platform Deliveroo for approximately $3.9 billion, expanding its reach to more than 40 countries.
Palantir (PLTR) stock dropped 7% in premarket trading yesterday despite solid earnings and a revenue forecast raise, as results failed to meet Wall Street’s lofty expectations for the data analytics firm. The stock has risen 63% this year, fueled by surging demand for its AI business.
Ford (F) has suspended its full-year financial guidance, stating that President Trump’s auto tariffs will reduce 2025 adjusted earnings before interest and taxes by approximately $1.5 billion on a net basis this year.
International Markets and Currency Movements
Asian markets showed strength overnight, with Hong Kong’s Hang Seng index jumping over 2% after China’s central bank announced plans to cut key interest rates to shore up growth amid trade concerns.
The dollar has seen modest gains in early trading after a two-day slide, while investors across Asia remain focused on currency appreciations from Taiwan to Malaysia. Gold prices continue to hover near $3,400 as investors seek safe-haven assets amid ongoing trade uncertainties.
As markets navigate the complex interplay of monetary policy, corporate earnings, and international trade tensions, today’s Fed decision will likely set the tone for trading in the days ahead. Investors should watch for comments on how the central bank views the potential economic impact of tariffs and whether this might accelerate or delay future rate cuts.
