Stock Market Live UpdatesMajor Indexes Retreat as Markets Digest Earnings and Await Policy Decisions
As of midday Tuesday, May 6, 2025, major U.S. stock indexes are trading lower, continuing Monday’s decline that snapped a historic nine-day winning streak for the S&P 500. The Dow Jones Industrial Average has fallen approximately 150 points or 0.5%, while the S&P 500 is down 0.4%, and the tech-heavy Nasdaq Composite has declined 0.7% since the opening bell.
Investors appear to be taking a cautious stance ahead of several significant market catalysts, including the Federal Reserve’s two-day policy meeting that begins today and ongoing uncertainty surrounding potential trade deals following President Trump’s recent tariff announcements.
Federal Reserve Meeting Takes Center Stage
The Federal Reserve’s May policy meeting kicks off today, with the rate decision expected tomorrow afternoon. Market participants are watching closely, though the probability of a rate cut at this meeting remains extremely low at just 2.7%, according to CME Group’s FedWatch tool.
“The Fed and investors find themselves in a no man’s land waiting to see whether economic policies drive prices higher and growth lower,” noted Scott Helfstein, head of investment strategy at Global X. “There isn’t a good reason to change rates at this point, and the Fed is likely to reiterate the need for more data.”
While May is unlikely to bring policy changes, investors will be parsing Fed Chair Jerome Powell’s comments for clues about potential rate cuts later this year, with July currently seen as the earliest likely timeframe for monetary easing.
Tariff Uncertainty Continues to Weigh on Markets
Trade concerns remain at the forefront as markets await news on potential deals following President Trump’s early-April announcement of hefty tariffs on major trading partners. Treasury Secretary Scott Bessent told CNBC that “we’re very close to some deals,” echoing President Trump’s comments that agreements could come as early as this week.
A Bloomberg report citing people familiar with the negotiations indicated that India has proposed zero tariffs on certain goods, though no official trade deals have yet been announced.
Palantir Shares Plunge Despite Strong Earnings
In corporate news, Palantir Technologies (PLTR) shares have dropped more than 10% despite the AI-powered data analytics company posting strong first-quarter results.
However, analysts pointed to concerns about the company’s high valuation and deceleration in international commercial revenues, which fell 5% year over year. CEO Alex Karp remained optimistic during the earnings call, stating that “Palantir is on fire” and that he’s “very optimistic” about the current setup.
Looking Ahead: Key Market Events to Watch
As we move through the trading week, several key events could impact market direction:
– The Federal Reserve’s rate decision and press conference tomorrow afternoon
– Potential announcements on trade deals with major U.S. trading partners
– Continued corporate earnings reports from major companies
– Friday’s Producer Price Index (PPI) data, which will provide further insights into inflation trends
Market participants should remain vigilant as these events unfold, potentially bringing increased volatility to an already uncertain market environment.
Market Sentiment and Outlook
The recent market pullback follows a strong recovery over the past two weeks that had erased losses stemming from President Trump’s tariff announcement. While economic data has been mixed—with GDP unexpectedly falling into negative territory in the first quarter but job growth topping forecasts in April—corporate earnings have generally remained robust.
As we approach the midpoint of 2025, investors continue to balance inflation concerns against signs of economic deceleration, with the Fed’s policy path and trade developments likely to remain the primary market drivers in the near term.