US Stock Market: Strong Earnings Meet Trade Uncertainty

Despite a generally positive trajectory for U.S. stocks during the week, buoyed by encouraging corporate earnings, market indicators pointed to a potential slowdown as the week drew to a close. Investors appeared to be balancing strong company performance against persistent economic uncertainties and the ongoing narrative surrounding international trade relations.

Futures contracts suggested a slightly weaker opening for major U.S. indices on Friday, following three consecutive sessions of advances. Pre-market activity indicated minor pullbacks for the S&P 500, the Dow Jones Industrial Average, and the Nasdaq composite, hinting at potential profit-taking or a rise in investor caution.

Corporate Earnings Paint Mixed Picture

A significant boost to market sentiment came from Alphabet (GOOGL), Google’s parent company. Its stock saw a notable increase of approximately 5% in after-hours trading on Thursday. This followed the release of its first-quarter results, which showcased an impressive 50% growth in profits. This robust performance materialized despite the company navigating various legal and competitive hurdles.

However, the technology sector also presented reasons for concern. Intel (INTC) shares experienced downward pressure, declining around 6.8% in pre-market trading. Although the semiconductor giant exceeded Wall Street’s earnings forecasts, its leadership issued conservative guidance for the rest of the year. Management pointed towards a more ambiguous economic environment, influenced by evolving trade policies under the current Trump administration, enduring inflationary pressures, and heightened regulatory scrutiny. This underscores the continued impact of trade policy unpredictability on corporate forecasting, even when underlying results are positive.

Global Market Movements

Across the Atlantic, European markets displayed cautious optimism. Key indices in Paris (CAC 40) and Germany (DAX) recorded modest gains. London’s FTSE 100 remained largely unchanged, digesting positive retail sales figures from the UK for March.

Activity in Asian markets was predominantly positive. Japan’s Nikkei 225 achieved a substantial gain of 1.9%, while South Korea’s Kospi advanced by 0.9%. In China, Hong Kong’s Hang Seng index rose by 0.3%, although the Shanghai Composite registered a marginal loss. Sentiment in the region received some support from news suggesting certain U.S.-manufactured semiconductor chips were exempted from significant Chinese tariffs, benefiting stocks such as Lenovo and Baidu (BIDU). Taiwan’s Taiex index also posted gains. Australian markets remained closed for a public holiday.

Commodities and Currencies

In commodity markets, crude oil prices saw a decline. WTI crude futures slipped to $61.99 per barrel, and Brent crude futures eased to $64.84 per barrel.

Turning to foreign exchange, the U.S. dollar gained ground against the Japanese yen, trading at 143.29 yen. Conversely, the euro experienced a slight dip against the dollar, settling at $1.1363.