Markets Soar on Strong Earnings and Mixed Macroeconomic Data
Market News 02 MAY
Last Thursday, the major U.S. indices posted solid gains: the S&P 500 climbed 0.63 %, the Dow Jones Industrial Average rose 0.21 %, and the Nasdaq 100 jumped 1.10 %. E-mini futures on the S&P and Nasdaq also rallied, up 0.64 % and 0.99 % respectively, signaling traders’ eagerness to maintain their bullish stance heading into Friday’s session.
Tech Titans Drive the “Magnificent Seven”
The engine behind Thursday’s rally was the Q1 earnings season, led by blockbuster reports from the tech giants. Microsoft beat consensus revenue and profit estimates for its fiscal third quarter, sending its shares up more than 7 %. Meta Platforms exceeded revenue forecasts for the first quarter, driving its stock over 4 % higher. Investors are now shifting their focus to Amazon and Apple, whose results were due after Thursday’s close.
Initial U.S. jobless claims unexpectedly rose by 18 000 to 241 000—the highest in two months—versus the 223 000 the market had forecast.
Continued claims climbed to 1.916 million, the highest level in three and a half years.
The April ISM Manufacturing PMI dipped to 48.7—a soft spot but still outperforming the expected drop to 47.9—while the Prices Paid subindex rose to 69.8, a near three-year high.
U.S. construction spending fell 0.5 % month-over-month in March, the steepest six-month decline and well below the 0.2 % gain economists anticipated.
All eyes now turn to Friday’s nonfarm payrolls report for April, where a gain of 138 000 jobs and an unchanged 4.2 % unemployment rate are forecast. Average hourly earnings are expected to rise 0.3 % month-over-month and 3.9 % year-over-year.
Interest rate swap markets now assign only a 7 % chance of a 25-basis-point Fed rate cut at the May 6–7 FOMC. Similarly, swap pricing suggests scant probability of an ECB rate cut at its June policy meeting.
Global Context and Outlook
In Asia, Japan’s Nikkei 225 rose 1.13 % to a one-month high, while Europe’s Euro Stoxx 50 and China’s Shanghai Composite were closed for Labor Day. Optimism over U.S.–China tariff talks—reported as constructive via multiple diplomatic channels—also buoyed risk sentiment.
Earnings Season in Full Swing
Bloomberg Intelligence data show first-quarter S&P 500 earnings are now expected to grow 6.7 % year-over-year, down from an 11.1 % forecast in November. Of the 303 companies that have reported so far, 78 % have beaten estimates. For full-year 2025, consensus EPS growth is pegged at 9.4 %, versus 12.5 % at the start of January.
Noteworthy movers included:
Carrier Global (+11 %) and Quanta Services (+9 %), both raising guidance after beating top-line forecasts.
IDEXX Laboratories (+8 %) after boosting its full-year EPS outlook.
In contrast, Beckton Dickinson slumped 18 % on a lowered earnings forecast, while Qualcomm fell 8 % on revenue guidance that missed analysts’ expectations.
Overall, the balance of risk is tilting toward equities: healthy corporate results and tempered macro data are setting an encouraging tone, though upcoming payroll figures and U.S.–China tariff developments could add volatility to global markets.