Futures Pointing To Initial Strength On Wall Street

The major U.S. index futures are currently pointing to a higher open on Friday, with stocks likely to move back to the upside following the sharp pullback seen in the previous session.

The upward momentum on Wall Street comes as traders continue to keep a close eye on the latest developments on the tariff front.

The futures had moved to the downside following news China plans to increase tariffs on U.S. imports to 125 percent beginning Saturday.

The 125 percent would match the tariff on China goods announced by President Donald Trump earlier this week, although a White House official told CNBC the effective rate is 145 percent when combined with a 20 percent fentanyl-related tariff.

However, the negative sentiment was offset by news that the European Union is suspending its planned countermeasures to Trump’s tariffs for 90 days.

European Commission trade spokesperson Olof Gill also told Ireland’s RTE radio European Trade Commissioner Maros Sefcovic will travel to Washington on Sunday to “try and sign deals.”

The markets may also benefit from a positive reaction to earnings news from financial giants JPMorganChase (JPM), Morgan Stanley (MS) and Wells Fargo (WFC).

Shares of JPMorganChase, Morgan Stanley and Wells Fargo are all seeing pre-market strength after the companies reported better than expected quarterly earnings.

Following an historic rally over the course of Wednesday’s session, stocks showed a substantial move back to the downside during trading on Thursday. The major averages all posted steep losses but remain well off their recent lows.

The major averages ended the day off their worst levels but still sharply lower. The Nasdaq plunged 737.66 points or 4.3 percent to 16,387.31, the S&P 500 tumbled 188.85 points or 3.5 percent to 5,268.05 and the Dow slumped 1,014.79 points or 2.5 percent to 39,593.66.

The sharp pullback on Wall Street came as traders looked to cash in on the spike seen in afternoon trading on Wednesday after President Donald Trump announced a 90-day pause on new “reciprocal tariffs.”

Ongoing concerns about rising trade tensions between the U.S. and China also weighed on the markets, as Trump excluded the country from the pause and even raised the tariff on Chinese goods to 125 percent.

Uncertainty about what will happen between now and the end of the 90-day pause may also have led to some apprehension on Wall Street.

“While the 90-day pause is welcome news for stocks, the lack of long-term clarity may become more of an issue as time goes on,” said AJ Bell investment director Russ Mould.

Meanwhile, traders largely shrugged off a Labor Department report unexpectedly showing a slight decrease by U.S. consumer prices in the month of March, potentially viewing the data as “old news.”

The report said the consumer price index edged down by 0.1 percent in March after rising by 0.2 percent in February. Economists had expected consumer prices to inch up by 0.1 percent.

Excluding food and energy prices, the core consumer price index crept up by 0.1 in March after rising by 0.2 percent in February. Core prices were expected to rise by 0.3 percent.

The report also said the annual rate of consumer price growth slowed to 2.4 in March from 2.8 percent in February. Economists had expected the pace of price growth to slow to 2.6 percent.

The annual rate of core consumer price growth also fell to 2.8 percent in March from 3.1 percent in February. Core price growth was expected to dip to 3.0 percent.

“The March CPI was stale data even before it was released given the large tariff changes in motion and the inflationary impact it will have in the coming months,” said Nationwide Chief Economist Kathy Bostjancic.

She added, “While it is marginally helpful to have a softer reading heading into the ratcheting up of tariffs, many of the categories that experienced a decline or were tame will face upward pressure in the coming months.”

A separate report released by the Labor Department showed first-time claims for U.S. unemployment benefits crept slightly higher in the week ended April 5th.

Oil service stocks pulled back sharply along with the price of crude oil, dragging the Philadelphia Oil Service Index down by 8.9 percent.

Airline stocks also showed a significant move back to the downside, resulting in an 8.4 percent nosedive by the NYSE Arca Airline Index.

Substantial weakness was also visible among semiconductor stocks, as reflected by the 8.0 plunge by the Philadelphia Semiconductor Index.

Oil producer, computer hardware, banking and biotechnology also saw considerable weakness, while gold stocks bucked the downtrend amid an extended rebound by the price of the precious metal.

Commodity, Currency Markets

Crude oil futures are inching up $0.16 to $60.23 a barrel after plunging $2.28 to $60.07 a barrel on Thursday. Meanwhile, after soaring $98.10 to $3,177.50 an ounce in the previous session, gold futures are surging $64.80 to $3,242.30 an ounce.

On the currency front, the U.S. dollar is trading at 142.87 yen versus the 144.45 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.1351 compared to yesterday’s $1.1201.

Asia

Asian stocks ended mostly lower on Friday after rising sharply in the previous session in response to U.S. President Donald Trump’s 90-day tariff pause. Chinese and Hong Kong markets outperformed amid expectations for stronger stimulus.

The U.S. dollar slumped to a decade-low versus the Swiss franc amid economic and policy turmoil, while gold jumped more than 1 percent to reach a new high above $3,200 per ounce following a short period of consolidation last week.

Crude oil prices were on track to book their second consecutive weekly loss as demand concerns intensified.

China’s Shanghai Composite Index rose 0.5 percent to 3,238.23 as market participants awaited the outcome of a Thursday meeting planned by China’s top leaders to discuss additional stimulus.

Hong Kong’s Hang Seng Index jumped 1.1 percent to 20,914.69 after Trump said the first trade deals are “very close” and voiced optimism that China would eventually come to the table.

Japanese markets tumbled as a stronger yen weighed on export-related shares. The Nikkei 225 Index plunged 3.0 percent to 33,585.58, while the broader Topix Index settled 2.9 percent lower at 2,466.91.

Canon, Toyota Motor, Panasonic and Sony lost 4-7 percent. Uniqlo-brand owner Fast Retailing declined more than 2 percent and Nvidia supplier Advantest gave up 4.6 percent.

Consulting firm Baycurrent soared 12.5 percent after raising its annual net profit forecast and announcing a share buyback to boost shareholder value.

Seoul stocks ended lower, with the Kospi falling half a percent to 2,432.72 amid an intensifying trade conflict between the United States and China.

Samsung Electronics, POSCO Holdings, LG Energy Solution and Hyundai Motor declined 2-5 percent.

Australian markets fell notably as investors fretted about the fallout from U.S. tariffs on global economic growth.

Reports suggested that Australia has declined China’s proposal to form an alliance against Washington’s tariffs, opting instead for diversified trade partnerships and diplomatic negotiations.

The benchmark S&P/ASX 200 Index dropped 0.8 percent to 7,646.50, with mining, energy and healthcare stocks pacing the declines. The broader All Ordinaries Index closed down 0.8 percent at 7,853.70.

Across the Tasman, New Zealand’s benchmark S&P/NZX-50 Index tumbled 1.5 percent to 12,019.13.

Europe

European stocks have moved back to the downside on Friday after logging their biggest one-day gains since 2022 the previous day as U.S. President Donald Trump decided to delay new tariffs by 90 days.

The euro surged to the highest level against the dollar in over three years after the EU said it would suspend its planned countermeasures to Trump’s tariffs for 90 days. Sterling also jumped as new data showed Britain’s economy picked up faster than expected in February.

French President Emmanuel Macron said today that the U.S. tariff suspension offers only a “fragile” pause in tensions but a vital opportunity for negotiations.

The pan-European STOXX 600 Index is down 0.3 percent at 485.82 after rallying 3.7 percent on Thursday. The German DAX Index is down by 1.3 percent and the French CAC 40 Index is down by 0.5 percent, although the U.K.’s FTSE 100 Index has bucked the downtrend and climbed by 0.5 percent.

Stellantis NV shares have moved sharply lower. The auto giant reported that its first-quarter shipments fell 9 percent compared to last year.

BP Plc has also shown a notable move to the downside. The energy group has warned of “weak” gas trading and higher debt in the first quarter.

In economic news, the U.K. economy expanded at a faster than expected pace in February with increases in all main sectors, data from the Office for National Statistics revealed.

Real GDP grew 0.5 percent from the previous month following a nil growth in January. GDP was expected to climb 0.1 percent. On a yearly basis, real GDP advanced 1.4 percent compared to economists’ forecast of 0.9 percent.

Meanwhile, U.K. recruiters reported the steepest rise in permanent and temporary labor supply in more than four years in March, while job placements declined notably due to weaker economic confidence and tighter client budgets, according to a report compiled by S&P Global.

U.S. Economic News

On the heels of yesterday’s report showing a surprise dip by U.S. consumer prices, the Labor Department released a separate report on Friday showing U.S. producer prices also unexpectedly decreased in the month of March.

The Labor Department said its producer price index for final demand fell by 0.4 percent in March after inching up by a revised 0.1 percent in February.

Economists had expected producer prices to rise by 0.2 percent compared to the unchanged reading originally reported for the previous month.

The report also showed the annual rate of producer price growth slowed to 2.7 percent in March from 3.2 percent in February. The annual rate of price growth was expected to creep up to 3.3 percent.

At 9 am ET, Boston Federal Reserve President Susan Collins is scheduled is to be interviewed on “Yahoo! Finance.”

The University of Michigan is due to release its preliminary reading on consumer sentiment in the month of April at 10 am ET. The consumer sentiment index is expected to fall to 54.5 in April after plunging to 57.0 in March.

Also at 10 am ET, St. Louis Federal Reserve President Alberto Musalem is scheduled speak on the U.S. economy and monetary policy and participate in a moderated conversation before the Arkansas State Bank Department’s 29th Annual Day with the Commissioner.

New York Federal Reserve President John Williams is due to speak on the economic outlook and monetary policy before the Puerto Rico Chamber of Commerce at 11 am ET.