Stock Market Update

The stock market is on course for a firmly higher start with futures on the S&P 500 trading 60 points above fair value.

The market was on the edge yesterday in anticipation of NVIDIA's (NVDA 142.15, +7.34, +5.4%) quarterly results, which were better than feared, but the bigger catalyst came from news that the Court of International Trade blocked President Trump's tariffs and ordered a dismantling of the enforcement mechanism in ten days.

The news has been met with gains in most global equity markets while sovereign debt is seeing some pressure with selling in U.S. Treasuries pushing the 30-yr yield back above the 5.000% mark.

The market will receive a few economic reports today, starting with the second estimate of Q1 GDP (Briefing.com consensus -0.3%; prior -0.3%) and weekly Initial Claims (Briefing.com consensus 230,000; prior 227,000) at 8:30 ET, followed by April Pending Home Sales (Briefing.com consensus -1.1%; prior 6.1%) at 10:00 ET.

In U.S. corporate news:

• NVIDIA (NVDA 142.15, +7.34, +5.4%): beat Q1 expectations and issued Q2 revenue guidance that accounts for lost sales to China. Summit Insights upgraded the stock to Buy from Hold.
• Salesforce (CRM 277.16, +1.13, +0.4%): beat Q1 EPS expectations and issued above-consensus guidance for Q2 and FY26. RBC Capital downgraded the stock to Sector Perform from Outperform with a $275 target.
• HP (HPQ 24.66, -2.54, -9.3%): missed Q2 EPS expectations and issued below-consensus EPS guidance for Q3 and FY25. KGI Securities initiated coverage of the stock with a Neutral rating and a $25 target.
• Veeva Systems (VEEV 269.01, +34.52, +14.7%): beat Q1 expectations and issued above-consensus guidance for Q2 and FY26.

Reviewing overnight developments:

• Asian markets ended higher. Japan's Nikkei +1.9%, Hong Kong's Hang Seng +1.4%, China's Shanghai Composite +0.7%.
  • In economic data:
    • Japan's May Household Confidence 32.8 (expected 31.8; last 31.2).
    • Australia's Q1 Building Capital Expenditure 0.9% qtr/qtr (last 0.2%), Q1 Plant/Machinery Capital Expenditure -1.3% qtr/qtr (last -0.6%), and Q1 Private New Capital Expenditure -0.1% qtr/qtr (expected 0.5%; last 0.2%).
    • New Zealand's May ANZ Business Confidence 36.6 (last 49.3).
  • In news:
    • The Bank of Korea lowered its policy rate by 25 basis points to 2.50%, as expected, and Governor Rhee said that he sees room for additional cuts.
    • Chip and auto-related stocks were among the outperformers after a U.S. court blocked President Trump's tariffs.
    • The New York Times reported that the U.S. will halt exports of jet engine technology and chip software to China. 
• Major European indices trade higher. Germany's DAX +0.2%, U.K.'s FTSE +0.1%, France's CAC +0.7%.
  • In economic data:
    • Italy's May Business Confidence 86.5 (expected 86.2; last 85.8) and Consumer Confidence 96.5 (expected 93.0; last 92.7). March Industrial Sales -1.6% m/m (last -0.4%); -1.1% yr/yr (last -1.6%). April non-EU trade surplus EUR2.18 bln (last EUR5.96 bln)
    • Spain's April Retail Sales 4.0% yr/yr (last 3.8%)
  • In news:
    • FT reported that the U.K. wants to accelerate the implementation of a trade deal with the U.S.
    • European Central Bank policymaker Kazimir was fined EUR200,000 after being found guilty of bribery by a court in Slovakia.