Tuesday, May 6, 2025
Pre-market indexes are sinking this morning, after coming off a -1/4 to -3/4 selloff, depending on the index, on Monday. We’re light on new economic prints at this hour — save for a new record-low trade deficit, which may be contributing to the sour mood this morning — but still have plenty of Q1 earnings reports to parse through. The Dow is down -300 points, the S&P 500 -50, the Nasdaq -250 and the small-cap Russell 2000 is -20 points currently.
New Record Trade Deficit: -$140.5 Billion
Before 2022, we had never seen a monthly print on the
U.S. Trade Deficit that reached 12-figures (-$100+ billion). Today, for March, we see this headline come in at a new all-time record depth: -$140.5 billion. This is worse than the -$137.6 billion estimated, which itself would have been a fresh record negative trade level, and follows the previous record, which was downwardly revised to -$123.2 billion.
These are not normal times for trade, however, as we know. Perhaps when the smoke clears we’ll see these numbers level-off some. Clearly, plenty of additional importing ahead of the April tariffs have distorted these numbers, but we’ll have to wait and see to what extent these numbers continue at or near record lows. (This trade deficit metric has been in play every month since 1992.)
Q1 Earnings Morning: DoorDash, ADM & Marriott
DoorDash DASH shares are trading down -5% on its Q1 earnings results released ahead of today’s open, even after beating earnings estimates by +10% to 44 cents per share. Revenues of $3.03 billion missed expectations by nearly -2%. The company has announced the acquisition of London-based Deliveroo for the equivalent of $3.9 billion, and hospitality tech firm SevenRooms for $1.2 billion. Shares had been up +22% year to date. For more on DASH’s earnings, click here.
Check out the updated Zacks Earnings Calendar here.Agriculture major
Archer-Daniels-Midland ADM beat estimates by a penny to 70 cents per share this morning, although this is still well off the $1.46 per share reported in the year-ago quarter. Revenues missed expectations by -2.5% to $20.18 billion. Weeks ago, the company announced it was halting some operations in China, and the global trade war is likely to take a toll on ADM, which is trading down -6% year to date. For more on ADM’s earnings, click here.
Global hotelier
Marriott International MAR shares are up nearly a percentage point this morning following its Q1 beat of 5 cents per share to earnings of $2.32. Revenues were modestly light of estimates, -0.10%, to $6.26 billion — still up from $5.98 billion reported in the year-ago quarter. Marriott shares are still down -11% from the start of the year, but +4% from a year ago. For more on MAR’s earnings, click here.
What to Expect from the Stock Market Today
The two-day
Federal Open Market Committee (FOMC) meeting begins today, when Fed presidents gather to decide whether to maneuver the Fed funds rate, which has remained in the 4.25-4.50% range since December. This remains 100 basis points (bps) below the top level of this cycle, from January 2023 to September of 2024.
We do not expect any Fed moves to be made on interest rates tomorrow. With the Fed’s dual mandate of keeping inflation under control and maximizing employment, as long as both of these monthly metrics continue coming in at healthy levels, which they have, we don’t expect the Fed to make any moves in either direction. If we suddenly see a spike in unemployment or a drop in inflation rates, perhaps we’ll see the first move of this year in June.
With the new global trade realities, we have seen the U.S. dollar destabilize a bit. But this might be a temporary condition — depending when/if trade deals with other countries get done — and, in any case, both 10-year and 2-year bond yields are around multi-month medians, so there’s no pressure to move on rates there, either. Only President Trump continues to pound the table on cutting rates, but we already know the FOMC won’t do this as long as the data does not suggest it needs to be done.
After today’s close, Q1 earnings season rolls along. We will hear from
Advanced Micro Devices AMD,
Electronic Arts EA and
Wynn Resorts WYNN, to name but a few. Wednesday brings us earnings results from
The Walt Disney Company DIS. If you’re waiting for
NVIDIA NVDA earnings to report, those don’t happen for another three weeks.
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Advanced Micro Devices, Inc. (AMD): Free Stock Analysis Report Marriott International, Inc. (MAR): Free Stock Analysis Report NVIDIA Corporation (NVDA): Free Stock Analysis Report Archer Daniels Midland Company (ADM): Free Stock Analysis Report Wynn Resorts, Limited (WYNN): Free Stock Analysis Report The Walt Disney Company (DIS): Free Stock Analysis Report Electronic Arts Inc. (EA): Free Stock Analysis Report DoorDash, Inc. (DASH): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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