US markets closed lower on Monday, which meant the end of the S&P 500’s nine-day winning streak. This was the best run for the index November 2004, which came despite last week’s unexpectedly-large decline in first quarter GDP, a so-so Non-Farm Payroll update, but a welcome drop in US inflation, as measured by Core PCE.
Monday’s session started on a firm footing after a strong ISM Services print briefly lifted sentiment. But the gains had evaporated by the close, reflecting caution heading into this key week for macro.
Source: TN Trader
Investors were also unimpressed by President Trump’s fresh tariff threat, this time aimed at film production outside the US. After last night’s close, Palantir Technologies reported earnings that topped expectations. Yet the stock dropped close to 8% overnight, despite adding in some positive forward guidance. The sell-off took Palantir’s stock down from an all-time high, and back to levels last seen on Wednesday.
US stock index futures also drifted lower overnight. But the sell-off increased in intensity as the Tuesday morning session progressed. Traders appear to be taking profits and moving to the sidelines ahead of the Federal Reserve’s FOMC meeting, which kicks off today. AMD and Super Micro Computer report after the close tonight. These will be watched closely for updates in the semiconductor sector.
Meanwhile, DoorDash reports before the US open. It is already in the news as it announced its purchase of one of the UK’s few ‘tech’ success stories, Deliveroo. Tariffs return to the spotlight on the political front as Trump imposed a 100% levy on the film industry, with pharma next in line.
Motor giant Ford suspended its 2025 guidance, citing the uncertain trade landscape. Overall, US stock indices are pulling back from last week’s highs. Traders look to be using the bounce since last month’s tariff tantrum as an opportunity to reduce their market exposure.
The question now is whether the indices consolidate at lower levels before another push higher, or if we can expect future rallies to be used as selling opportunities
