Stocks Pressured as Earnings Roll In

The S&P 500 Index ($SPX) (SPY) today is down -0.19%, the Dow Jones Industrials Index ($DOWI) (DIA) is up +0.34%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down -0.39%.  June E-mini S&P futures (ESM25) are down -0.13%, and June E-mini Nasdaq futures (NQM25) are down -0.20%. 

Stock index futures today gave up overnight gains and turned lower after General Motors fell more than -3% when it pulled earnings guidance for 2025 and put share buybacks on hold until it has more clarity on the impact of US tariffs.  The markets await earnings from four Magnificent Seven technology stocks this week, including Microsoft, Meta Platforms, Amazon.com, and Apple. 

Stock index futures initially moved higher in overnight trade on signs of easing trade tensions.  The Wall Street Journal reported that President Trump said he would ease auto tariffs, lifting levies on foreign parts for cars and trucks made in the US and giving imported autos a break from separate tariffs on aluminum and steel.  The change in tariffs would allow automakers to secure a partial reimbursement for tariffs on imported auto parts based on the value of their US car production, with reimbursements declining over time to encourage supply chain shifts to the US.

Corporate news today is mixed for stocks.  On the negative side, NXP Semiconductors NV is down more than -7% to lead chip stocks lower after announcing CEO Sievers will retire by the end of this year and warned it was navigating “a very uncertain environment” due to tariffs.  Also, Regeneron Pharmaceuticals is down more than -8% after reporting Q1 revenue below consensus.  On the positive side, Sherwin-Williams is up more than +5% after reporting Q1 adjusted EPS above consensus.   Also, Honeywell International is up more than +4% after reporting better-than-expected Q1 adjusted EPS and forecasting Q2 adjusted EPS above consensus. 

The US Mar trade deficit unexpectedly widened to a record -$162.0 billion, wider than expectations of -$145.0 billion and a negative factor for Q1 GDP.

The US Feb S&P CoreLogic composite 20 home price index rose +4.5% y/y, weaker than expectations of +4.7% y/y.

Market attention this week will focus on news of US tariffs and trade negotiations.  Today, the Conference Board Apr consumer confidence index is expected to fall -5.3 points to 87.6.  On Wednesday, Q1 GDP is expected at +0.4% (q/q annualized), with the Q1 core PCE price index up +3.0%.  Wednesday also brings Mar personal spending (expected +0.6% m/m), Mar personal income (expected +0.4% m/m), and the Mar core PCE price index (expected unchanged m/m and +2.2% y/y).  Finally, Microsoft and Meta Platforms release their quarterly earnings on Wednesday. On Thursday, the Apr ISM manufacturing index is expected to fall -1.0 to 48.0.  Thursday also brings earnings results from Amazon.com and Apple. Friday brings Apr nonfarm payrolls (expected +130,000) and the Apr unemployment rate (expected unchanged at 4.2%). Also, Apr average hourly earnings are expected to climb +0.3% m/m and +3.9% y/y.   

The markets are discounting the chances at 9% for a -25 bp rate cut after the May 6-7 FOMC meeting.

Q1 earnings reporting season is in full swing.  According to data compiled by Bloomberg Intelligence, the market consensus is for Q1 year-over-year earnings growth of +6.7% for the S&P 500 stocks, down from expectations of +11.1% in early November.  So far, just over a third of S&P 500 companies have reported quarterly results, with 75% beating estimates.  Full-year 2025 corporate profits for the S&P 500 are seen rising +9.4%, down from the forecast of +12.5% in early January.  

Overseas stock markets today are lower.  The Euro Stoxx 50 is down -0.47%.  China’s Shanghai Composite fell to a 1-week low and closed down -0.059%.  Japan’s Nikkei Stock 225 did not trade today, with markets in Japan closed for the Showa Day holiday.

Interest Rates

June 10-year T-notes (ZNM25) today are down -2 ticks.  The 10-year T-note yield is up +0.6 bp to 4.214%.  June T-notes today are slightly lower as easing trade tensions have reduced safe-haven demand for T-notes after the Wall Street Journal reported that President Trump is easing tariffs on foreign parts for cars and trucks made inside the US.  Losses in T-note are limited on some carryover support from strength in European government bonds.  T-notes also found support on today’s news that showed a record US Mar trade deficit, which is negative for Q1 GDP and dovish for Fed policy.

European government bond yields today are moving lower.  The 10-year German bund yield is down -1.5 bp to 2.5096%.  The 10-year UK gilt yield is down -2.0 bp to 4.489%.

The Eurozone Apr economic confidence index fell -1.4 to a 4-month low of 93.6, weaker than expectations of 94.5.

The ECB Mar 1-year CPI inflation expectations unexpectedly rose to an 11-month high of 2.9% from 2.6% in Feb, stronger than expectations of a decline to 2.5%.  The ECB Mar 3-year CPI expectations unexpectedly rose to a 1-year high of 2.5% from 2.4% in Feb, stronger than expectations of a decline to 2.3%.

Swaps are discounting the chances at 100% for a -25 bp rate cut by the ECB at the June 5 policy meeting.

US Stock Movers

Regeneron Pharmaceuticals (REGN) is down more than -8% to lead losers in the S&P 500 after reporting Q1 revenue of $3.03 billion, well below the consensus of $3.25 billion. 

NXP Semiconductors NV (NXPI) is down more than -7% to lead chip stocks lower after announcing CEO Sievers will retire by the end of this year and warned it was navigating “a very uncertain environment” due to tariffs.  Also, On Semiconductor (ON) is down more than -3%, and Microchip Technology (MCHP) is down more than -2%.  In addition, Texas Instruments (TXN), ASML Holding NV (ASML), Applied Materials (AMAT), Micron Technology (MU), Analog Devices (ADI), GlobalFoundries (GFS), Qualcomm (QCOM), and Lam Research (LRCX) are down more than -1%.

Spotify (SPOT) is down more than -6% after reporting Q1 monthly active users of 678 million, below the consensus of 679.04 million, and forecast Q2 monthly active users of 689 million, weaker than the consensus of 694.38 million.  

Brown & Brown (BRO) is down more than -7% after reporting Q1 organic revenue rose 6.50%, below the consensus of 6.62%.

General Motors (GM) is down more than -3% after withdrawing earnings guidance for 2025 and pausing $4 billion in share repurchases until it has more clarity on tariff impacts.    

Waste Management (WM) is down more than -1% after reporting Q1 operating revenue of $6.02 billion, weaker than the consensus of $6.11 billion.   

Zebra Technologies (ZBRA) is up more than +6% to lead gainers in the S&P 500 after reporting Q1 adjusted EPS of $4.02, stronger than the consensus of $3.63.

Sherwin-Williams (SHW) is up more than +5% to lead gainers in the Dow Jones Industrials after reporting Q1 adjusted EPS of $2.25, better than the consensus of $2.16.

Honeywell International (HON) is up more than +4% after reporting Q1 adjusted EPS of $2.51, stronger than the consensus of $2.21, and forecast Q2 adjusted EPS of $2.60-$2.70, better than the consensus of $2.57.

Okta (OKTA) is up more than +5% after S&P Dow Jones Indices announced that the stock will replace Berry Global in the S&P MidCap 400 before trading opens on May 1.

Crown Holdings (CCK) is up more than +7% after reporting Q1 net sales of $2.89 billion, stronger than the consensus of $2.82 billion. 

Hims & Hers Health (HIMS) is up more than +22% after Novo Nordisk partnered with it to offer its weight loss drug Wegovy at a reduced price through the NovoCare direct-to-consumer pharmacy platform.

Earnings Reports (4/29/2025)

A O Smith Corp (AOS), Altria Group Inc (MO), American Tower Corp (AMT), Arch Capital Group Ltd (ACGL), Booking Holdings Inc (BKNG), BXP Inc (BXP), Caesars Entertainment Inc (CZR), Coca-Cola Co/The (KO), Corning Inc (GLW), CoStar Group Inc (CSGP), Ecolab Inc (ECL), Edison International (EIX), Entergy Corp (ETR), Equity Residential (EQR), Essex Property Trust Inc (ESS), Expand Energy Corp (EXE), Extra Space Storage Inc (EXR), Fair Isaac Corp (FICO), First Solar Inc (FSLR), General Motors Co (GM), Hilton Worldwide Holdings Inc (HLT), Honeywell International Inc (HON), Incyte Corp (INCY), Kraft Heinz Co/The (KHC), Labcorp Holdings Inc (LH), Mondelez International Inc (MDLZ), ONEOK Inc (OKE), PACCAR Inc (PCAR), PayPal Holdings Inc (PYPL), Pfizer Inc (PFE), PPG Industries Inc (PPG), Regency Centers Corp (REG), Regeneron Pharmaceuticals Inc (REGN), Royal Caribbean Cruises Ltd (RCL), S&P Global Inc (SPGI), Seagate Technology Holdings PL (STX), Sherwin-Williams Co/The (SHW), Starbucks Corp (SBUX), Sysco Corp (SYY), United Parcel Service Inc (UPS), Veralto Corp (VLTO), Visa Inc (V), Xylem Inc/NY (XYL), Zebra Technologies Corp (ZBRA).