John Hancock: Weekly Market Recap Week Ended May 9
Trade movements
U.S. stocks fell on Monday and Tuesday, then reversed course the next two days as news of trade talks lifted investor sentiment. The United States and the United Kingdom announced a framework aimed at reaching a comprehensive trade agreement, and U.S. and Chinese officials announced plans for negotiations in the wake of recent tariff increases.
Fed’s uncertain outlook
The U.S. Federal Reserve kept interest rates unchanged for its third meeting in a row, extending its wait-and-see policy approach, The Fed issued a statement noting that “the risks of higher unemployment and higher inflation have risen,” and Fed Chair Jerome Powell said that it’s “not at all clear” what the central bank should do next.
Earnings finish
Earnings continued to improve overall entering the final stretch of earnings season, with 90% of S&P 500 companies having reported first-quarter results as of Friday. Net income was expected to rise an average of 13.4%, based on reports already released and forecasts for the relatively small number of companies that hadn’t yet reported, according to FactSet. At the end of the previous week, the projected earnings growth rate was 12.8%.
CPI ahead
A Consumer Price Index report scheduled for release on Tuesday will show whether a recent trend of moderating inflation extended into April as tariffs and global trade tensions rose. Last month’s CPI report showed an annual rate of 2.4% in March, down from 2.8% the previous month.
Source: https://www.jhinvestments.com/weekly-market-recap#market-moving-news