5 things to know before the stock market opens Monday

Stocks

China–U.S. Trade War

Summary:

Stock futures slipped as a busy week of earnings and economic data approaches. Tariffs impact Chinese factories and U.S. consumer behavior. Domestic airfare drops amid slowdown fears, while major companies like Apple and Amazon report results.

Here are the most important news items that investors need to start their trading day:

Inching back

Stock futures slid Monday as investors looked ahead to a jammed week of earnings reports and economic data. The three major U.S. indexes climbed last week and have now recovered much or all of what they lost after President Donald Trump announced steep tariffs on dozens of countries at the start of the month – which he has since temporarily lowered. The S&P 500 has fallen 1.5% so far in April, while the Dow Jones Industrial Average has dropped 4.5%. The Nasdaq Composite has gained 0.5%. In addition to hearing how some of the most important companies in the world are faring, investors will also digest first-quarter gross domestic product and the Fed’s preferred inflation metric, both out Wednesday, followed by the April jobs report on Friday. Follow live market updates.

Earnings extravaganza

The busiest week of earnings season is upon Wall Street. About one-third of both the S&P 500 and Dow will post results this week. Those include four of the so-called Magnificent Seven – Apple, Amazon, Meta and Microsoft – along with major consumer brands like Coca-Cola, Starbucks, McDonald’s and Eli Lilly. Investors will be watching whether any companies reduce or withdraw their financial guidance because of tariffs or lower consumer spending. Several restaurants, airlines and consumer packaged goods companies took that step last week. Here are the key reports to watch:

Tuesday: UPS , Pfizer, Coca-Cola (before the bell); Starbucks (after the bell)

Wednesday: Yum Brands, Etsy (before the bell); Meta, Microsoft, Qualcomm (after the bell)

Thursday: CVS, Eli Lilly, McDonald’s (before the bell); Apple, Amazon, Airbnb, Reddit, Block (after the bell)

Friday: Chevron, Exxon Mobil (before the bell)

Saturday: Berkshire Hathaway

China crunch

Trump’s tariff on Chinese imports is starting to hit businesses in the country. Some manufacturers are either trying to find new markets or stopping production in the face of the 145% duty the U.S. has imposed on many goods. “I know several factories that have told half of their employees to go home for a few weeks and stopped most of their production,” said Cameron Johnson, Shanghai-based senior partner at consulting firm Tidalwave Solutions. Many of the most affected businesses make toys, sporting goods or low-cost items sold at places like dollar stores.

Pall of duty

The threat of tariffs has caused U.S. consumers to spring early for some major purchases like cars and iPhones. But in many other areas, shoppers are holding out because of the duties and economic uncertainty. “There’s so much uncertainty right now that shoppers just don’t know what to do,” said Steve Zurek, vice president of thought leadership at NielsenIQ. “There’s nowhere to hide here — all they can do is control the household economics they have.”

Losing altitude

Domestic airfare is falling in the U.S. Airline CEOs have said demand for domestic trips is falling as travelers digest tariffs and concerns about an economic slowdown, leaving empty seats in the back of planes. “Nobody really relishes uncertainty when they’re talking about what they could do on a vacation and spend hard-earned dollars,” American Airlines CEO Robert Isom said on a quarterly earnings call on Thursday. Even so, Americans are still traveling overseas in droves.

Source: cnbc

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