U.S. equity markets kicked off the week with gains, recovering from early losses triggered by former President Donald Trump’s renewed tariff threats. Initially rattled by his announcement of new tariffs on imports from the EU, Mexico, Canada, and India, investors later responded positively to his unexpected openness to further trade negotiations.
Despite escalating rhetoric—including a proposed 30% tariff on goods from the EU and Mexico, and potential 200% duties on pharmaceutical companies that fail to relocate production to the U.S.—markets found relief in Trump’s willingness to re-engage in talks, which was interpreted as a sign of potential de-escalation.
Markets were also buoyed by stronger-than-expected trade data from China. Exports rose 5.8% year-over-year, and imports increased 1.1%, signaling resilience in global demand and lifting sentiment across global equities, even as trading sessions closed mixed in Europe and Asia.
Bitcoin surged to a new all-time high, gaining over 1% on Monday. The rally came as the U.S. House of Representatives prepared to debate a crypto-friendly bill, with this week dubbed "Crypto Week" by the House Financial Services Committee.
Still, the macro backdrop remains complex. Inflation expectations in the U.S. are rising, pushing the yield on 10-year Treasury notes to a 3.5-week high. Cleveland Fed President Loretta Mester warned that the central bank is not yet ready to cut rates, emphasizing the need for further inflation progress.
Investors are bracing for a packed week of economic data: Tuesday’s CPI report, Wednesday’s PPI and Beige Book, and Friday’s housing and consumer sentiment reports. Expectations are cautiously optimistic, though inflation risks continue to limit upside potential.
Adding to investor caution is the start of Q2 earnings season. According to Bloomberg, S&P 500 companies are projected to post earnings growth of just 2.8% year-over-year—the weakest pace in two years.
Stock highlights:
Top gainers included Nebius Group (+17%), after a bullish call from Goldman Sachs; AppLovin (+5%), cited by Citi as a “top pick”; and Autodesk (+5%), which announced a focus on organic growth and continued share buybacks.
Boeing shares rose after investigators found no immediate concerns following last month’s Air India crash.
Crypto-linked stocks MicroStrategy (+3%), Coinbase (+1%), and Riot Platforms (+1%) climbed alongside Bitcoin.
On the downside: Micron (-4%), Waters (-13%) following a debt-heavy M&A deal, and Procter & Gamble, Best Buy, and Starbucks, all hit by analyst downgrades.
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