Markets pulled back on Tuesday as investors awaited the upcoming U.S. Federal Reserve decision. Bond yields dipped after a strong auction, while the U.S. dollar weakened against key currencies. Political tensions and economic expectations added to the volatility across major regions.
United States
📉 Equities
U.S. stocks declined, with the S&P 500 dropping 0.77% to 5,606.91. The Dow lost 0.95%, and the Nasdaq fell 0.87%. Concerns over stalled trade talks and the Federal Reserve’s Wednesday policy decision drove investor caution.
💵 Bonds
The Treasury market saw strong demand at the $42 billion 10-year note auction. The yield was set at 4.342%, slightly below market expectations. Notably, non-mandated buyers accounted for 91.1% of purchases.
💱 Currency
The U.S. dollar index slipped 0.62% to 99.19. The euro climbed 0.57% to $1.1378, while the yen strengthened 0.91% to 142.39.
📊 Corporate Moves
- Palantir shares fell 12% after profit-taking, despite improved forecasts.
- Ford rose 2.6%, with investors praising its cautious approach to guidance amid tariff risks.
- Eli Lilly dropped 5.6%, underperforming amid a wider pharma sell-off.
Eurozone
📉 Equities
European markets ended mixed. The STOXX 600 dropped 0.18%, and Germany’s DAX fell 0.4% after political uncertainty surrounding the chancellorship.
💵 Bonds
Bund yields remained steady as investors awaited further economic updates and political clarity.
💱 Currency
The euro gained ground against the dollar, supported by U.S. weakness and eurozone stability concerns.
United Kingdom
📈 Equities
The FTSE 100 edged up 0.01% to 8,597.42. Tesco shares rose 1.56% to £3.77, outperforming the broader index despite low trading volumes.
💵 Bonds
Gilt yields were volatile ahead of the Bank of England’s Thursday meeting. Markets expect a 25-basis-point rate cut, with more to follow later in the year.
💱 Currency
The British pound gained 0.2% to $1.3323 and strengthened to 84.95 pence against the euro.
China
📈 Equities
Chinese stocks climbed on hopes of a U.S.-China trade agreement and expectations of monetary easing. A stronger yuan further lifted sentiment.
💵 Bonds
Chinese bond yields remained near record lows. Market sentiment reflects ongoing concerns over sluggish growth and low inflation.
💱 Currency
The yuan reached a six-month high, closing at 7.2169 per dollar. The rally was driven by unwinding carry trades and a shift away from U.S. assets.
Japan
📉 Equities
Japanese stocks declined, with the Nikkei 225 falling as investors reacted to global trade tension and a stronger yen.
💵 Bonds
Yields on Japanese government bonds were stable. The 10-year yield hovered around 0.1% as the Bank of Japan maintained its loose policy stance.
💱 Currency
The yen appreciated 0.91% to 142.39 against the dollar, benefiting from safe-haven demand.
🌍 EMEA (Europe, Middle East, and Africa)
📊 Equities
EMEA markets showed mixed performance. Optimism grew after the UK and India finalized a long-awaited free trade deal.
💵 Bonds
Bond yields across the region reflected global caution and sensitivity to local developments.
💱 Currency
Currencies reacted to dollar weakness and domestic economic shifts across the region.
🛢️ Commodities
🛢️ Oil
Oil prices bounced back. U.S. crude rose 3.43% to $59.09 per barrel, while Brent climbed 3.19% to $62.15. Demand optimism and reduced U.S. supply contributed to the recovery.
🪙 Gold
Gold surged 2.64% to a two-week high. Buying from China after the holiday, along with Middle East tensions, drove demand.
💹 Cryptocurrencies
Major coins remained range-bound as investors awaited the Fed’s move. Risk sentiment across crypto stayed cautious.
🚀 Top Movers
- Hims & Hers: +18% on strong growth
- Mattel: +2.8% after announcing production shifts and pricing changes
🔻 Decliners
- Palantir: -12% on profit-taking
- Eli Lilly: -5.6% amid a sector-wide pullback
🗓️ Market Date: May 6, 2025
This overview highlights the key movements across asset classes ahead of the Fed decision, as investors brace for monetary and geopolitical shifts.
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