U.S. stock futures tumbled in premarket trading amid heightened fears of rising tariffs and a grim earnings revision from FedEx. S&P 500 Index futures retreated by 0.8%, while Dow Jones Industrial Average futures recoiled by 0.7%, and Nasdaq futures plummeted by a stark 1.0%.

In a significant blow, FedEx's stock plunged over 9% before the opening bell, following the company's slash in its fiscal 2025 outlook, signaling deepening economic turmoil. This sharp downturn in FedEx shares casts a shadow over the global economic outlook, with delivery companies often regarded as bellwethers of economic health.

The investment landscape is fraught with caution as global trade frictions intensify, with markets bracing for President Trump's impending tariff strategy. Although Federal Reserve Chair Jerome Powell's recent remarks offered a glimmer of confidence in the economy's resilience, he acknowledged the shadow cast by trade policy uncertainties. The trading community is bracing for a potential easing in monetary policy, with odds favoring a 25 basis point cut at the Fed's June gathering at a 70% probability. The markets are caught in a whirlwind of volatility, wrestling with the dual forces of trade policy upheavals and shifting corporate earnings projections.

Despite some reassurance from the Federal Reserve's tempered stance, investors remain on tenterhooks, wary of the erratic nature of Donald Trump's economic and political maneuvers which continue to confound market prognosticators. The descent in U.S. stocks since mid-February sketches a narrative of guarded skepticism over the trajectory of the U.S. economy, with financial pundits adopting a stance of watchful wariness.

Today, there are no major macroeconomic indicators scheduled for release. However, two significant events are on the agenda. First, John Williams, the President of the New York Federal Reserve, is set to deliver a speech. This comes just two days after the Federal Reserve's recent meeting, and his remarks may provide insights or updates following that meeting. Additionally, today marks the end of the month and the stock market quarter, specifically the third Friday of the third month of the quarter. This date is significant for the expiration of derivatives, commonly referred to as "Triple Witching" in the stock market. In the United States, approximately $4.5 trillion worth of options are set to expire, potentially leading to substantial financial flows and market activity.

Yesterday, Wall Street rebounded sharply as investors aligned their expectations with the Federal Reserve's outlook. Fed Chairman Jerome Powell indicated that the US economy continues to grow, inflation is expected to stabilize, and interest rates might eventually decrease. However, Powell acknowledged increased risks since Donald Trump's presidency, mentioning concerns about stagflation and revisiting the idea of transitory inflation, a concept that previously proved challenging for the central bank .European stock markets experienced a downturn, with major indices in Germany, Italy, and France declining.

Recent corporate earnings reports from companies with differing fiscal year ends indicate a challenging outlook. Nike and FedEx have issued warnings about a tougher future, citing rising costs and more cautious consumer spending. Accenture's stock dropped over 7% following comments from its CEO about the impact of a spending freeze by the U.S. public administration. The White House, under Trump, is aware of these economic pressures. The administration is communicating that while the situation may be difficult initially, improvements are expected in the long term. Despite these reassurances, there is growing tension in business circles, raising concerns about potential significant disruptions.

In the Asia-Pacific region, the Tokyo stock exchange, which was closed for a public holiday yesterday, lost 0.1% on the Nikkei 225 side, but gained 0.5% on the TOPIX side. Profit-taking continues in China, both in Hong Kong (-2.3%) and Shanghai (-1.5%). South Korea is down slightly, while Taiwan's losses are more pronounced (-0.9%). Australia and India remain in the green. European indices are bearish.

Today's economic highlights:

See the full calendar here.

  • Dollar index: 103,980
  • Gold: $3,035
  • Crude Oil (BRENT): $72.03 (WTI) $67.77
  • US 10-year: 4.20%
  • BITCOIN: $84,000

In corporate news:

  • Banco de Sabadell shareholders reelected CEO Cesar Gonzalez-Bueno Mayer and approved two buyback programs totaling 1.002 billion euros.
  • Nike reported a decline in quarterly net profit and sales, with further decline expected in the fourth quarter.
  • Teslarecalls most of its Cybertrucks due to a bodywork problem.
  • FedEx reduced its revenue and earnings forecasts for the fiscal year due to weak demand and the loss of a USPS contract.
  • Micron Technology Inc. exceeded second-quarter earnings expectations and anticipates third-quarter revenue to surpass estimates.
  • Nucor loses 2.7% in after-hours trading after its quarterly results.
  • Apple shakes up its AI managers in an attempt to turn Siri around, according to Bloomberg.
  • Lockheed Martin and Boeing are expected to find out today who has been awarded the contract for the US Army's next-generation fighter jets.
  • Malaysia Airlines ordered 30 B737MAX aircraft.
  • Colgate announces a dividend increase and a new $5 billion share buyback program.
  • Curtiss-Wright receives contracts from Rheinmetall to supply turret drive stabilization systems for Boxer heavy weapon transport vehicles and Lynx infantry fighting vehicles.

Analyst Recommendations:

  • Adobe Inc.: KeyBanc Capital Markets upgrades to sector weight from underweight.
  • Celanese Corporation: KeyBanc Capital Markets upgrades to overweight from sector weight with a target price of USD 76.
  • Host Hotels & Resorts, Inc.: Morgan Stanley downgrades to equalwt from underwt with a target price reduced from USD 16 to USD 15.
  • Norwegian Cruise Line Holdings Ltd.: Morgan Stanley downgrades to equalwt from underwt with a target price reduced from USD 27 to USD 22.
  • Accenture Plc: Deutsche Bank maintains its hold recommendation with a price target reduced from USD 365 to USD 290.
  • Caesars Entertainment, Inc.: Morgan Stanley maintains its market weight recommendation and reduces the target price from 38 to USD 30.
  • Micron Technology, Inc.: Baird maintains its outperform recommendation and raises the target price from USD 130 to USD 163.