Published as of: May 14, 2025, 9:07 a.m. ET
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| The markets | Last price | Change | % change |
|---|---|---|---|
| S&P 500® index | 5,886.55 | +42.36 | +0.72% |
| Dow Jones Industrial Average® | 42,140.43 | -269.67 | -0.64% |
| Nasdaq Composite® | 19,010.09 | +301.74 | +1.61% |
| 10-year Treasury yield | 4.48% | -0.01 | -- |
| U.S. Dollar Index | 101.62 | -0.39 | -0.38% |
| Cboe Volatility Index® | 18.24 | +0.02 | +0.01% |
| WTI Crude Oil | $62.99 | -$0.68 | -1.07% |
| Bitcoin | $104,610 | -$420 | -0.04% |
Disclosure
Major index values are as of Tuesday's close; others are as of 8:51 a.m. ET.
(Wednesday market open) Attention flips from data and trade to earnings as investors await Cisco's (CSCO) results and stocks extend this week's massive rally. A host of firms report before the weekend, including Walmart (WMT), in earnings season's final stretch. Investors also have an eye on President Trump as he travels in the Middle East, and on Washington, D.C., where Congress hammers out a budget deal.
While the bulls stampeded on Wall Street early this week amid cooling trade tensions, there's concern about Treasury yields as they ascend. The yield surge to one-month highs reflects better long-term growth hopes and didn't respond much to yesterday's mild April Consumer Price Index (CPI) report. "The bond market and the Fed have to consider the impact of tariffs and expansive fiscal policy longer-term," said Kathy Jones, chief fixed income strategist at Schwab. "I wouldn't expect a significant down move in yields or change in Fed policy now. Later in the year, we look for lower yields and two rate cuts."
This week's Wall Street rally put valuations back into view as well. The forward price-to-earnings (P/E) ratio on the S&P 500 index (SPX) is now 22 and arguably factors in very little discount for potential risks. "Does that matter in the near term?" said Nathan Peterson, director of derivatives analysis at the Schwab Center for Financial Research. "Probably not. Sentiment can drive the near-term action longer than most anticipate."
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Three things to watch
- Cisco, Walmart, Applied Materials give insight on spending, demand: Cisco, which reports after the bell, is often seen as a proxy for global business spending on technology. Cisco's revenue popped last time out after several quarters of declines, and the company delivered a positive forecast. Large firms reporting earlier this earnings season said they aren't planning to slow spending on technology, which could bode well for Cisco's AI infrastructure business. Applied Materials (AMAT) follows with results tomorrow. The company supplies equipment and services for chip manufacturing, can be a useful barometer for semiconductor demand and could also provide color on recent AI demand. But the biggest company reporting this week is Walmart first thing Thursday, giving investors a front-row seat to view the impact of higher tariffs on consumer behavior and retailer strategy. Walmart's shares are up slightly this year, possibly reflecting perceived resiliency from its continued focus on cost-saving investments, most recently in AI.
- Retail sales, PPI up next: The latest Consumer Price Index (CPI) report yesterday was benign, the third in a row after a rough stretch in December and January. Next, tomorrow features the Producer Price Index (PPI) and retail sales for April before the open. Producer prices, or prices at the wholesale level, could provide more insight into tariff impacts than CPI, which tends to lag PPI. Last month featured a large drop in product shipments to the U.S. from China as tariffs took effect, possibly a sign of reduced demand for Chinese products from wholesalers holding off amid hope things might improve. The impact on prices is uncertain, because less demand might indicate less price pressure, but supplies of goods also likely fell. Analysts expect 0.3% increases in both headline and core PPI, with core excluding volatile food and energy. That's up from –0.4% and –0.1% in March, respectively. Retail sales are seen easing to 0.2% from 1.4% in March, perhaps a sign of consumers slowing down purchases after stocking up in the first quarter as tariffs loomed. The key retail sales number to watch is control group retail sales, which factor into the government's gross domestic product (GDP) calculation and was well below headline growth in March.
- Economic growth still could slow: The first quarter featured solid corporate earnings and decent consumer spending as people and businesses prepared for the possible impact of tariffs. The result could be that growth got pulled ahead, making the current and coming quarters more difficult for the economy even now that there's been a delay in the highest tariffs on Chinese goods. The temporary dialing back of tariffs occurred roughly halfway through the second quarter, meaning much of the quarter's data and earnings will reflect the trade war, whatever happens from here. The Atlanta Fed's most recent GDPNow reading for second quarter GDP growth was 2.3%, but analysts' consensus is below 1%, and the possibility of a recession hasn't necessarily come off the table completely, with Goldman Sachs (GS) seeing a 35% chance. Several Fed speakers today could share views on the economy, and Fed Chairman Jerome Powell makes public remarks tomorrow at 8:40 a.m. ET. Before the tariff pause, U.S. businesses were already starting to react, pulling back on investment and hiring. Consumers did some preemptive shopping in the first quarter, which could mean they've now stocked up.
On the move
- Coinbase Global (COIN) climbed 0.5% in early trading after rising nearly 24% % yesterday on news it's being added to the S&P 500. Cryptocurrencies generally weakened this morning after going on a roll the last few weeks.
- Airline shares added to gains in pre-market trading after many traded sharply higher Tuesday amid hopes for improving trade relations between the U.S. and its partners. Shares of United Airlines (UAL), Delta Air Lines (DAL), and Alaska Air (ALK) were up 3% to 5% late Tuesday.
- Super Micro Computer (SMCI) rose another 17% in pre-market trading after climbing double digits yesterday as Raymond James initiated coverage with an Outperform rating and called it a "market leader in AI-optimized infrastructure." Fresh news surfaced this morning as SMCI announced a $20 billion partnership with Saudi data center firm DataVolt for SMCI's GPU platforms and rack-scale liquid cooling systems.
- Nvidia (NVDA) added another 3% this morning after staying on a roll yesterday and climbing above its 200-day moving average. The major news yesterday was an announcement by CEO Jensen Huang that Nvidia will supply AI chips to Saudi Arabia's AI company Humain for a data center project. Advanced Micro Devices (AMD), a competitor of NVDA, will also be a supplier. Nvidia's earnings are expected May 28, and investors might be building bullish positions ahead of results.
- AMD rose 4.3% ahead of the open, also on excitement over the Humain deal.
- American Eagle Outfitters (AEO) plunged nearly 12% in pre-market trading after the clothing and accessories retailer withdrew its 2025 guidance and said it was taking $75 million in write-offs related to spring and summer merchandise, CNBC reported. The company expects overall sales to drop 5% in its fiscal first quarter.
- Tesla (TSLA) jumped 3.1% ahead of the open after the Financial Times reported that Tesla's board is looking into a new pay package for CEO Elon Musk. Shares of Tesla have risen more than 50% from the April closing low despite disappointing earnings and more bad news on sales overseas.
- The Relative Strength Index (RSI) for the SPX is rapidly approaching overbought territory that looms at 70. It was trading at nearly 68 as of late Tuesday, up from oversold territory below 25 just a month ago.
More insights from Schwab
Inside the Beltway: With trade calmer, attention turns to Congress as leaders work on a budget deal that would extend the 2017 tax cuts. House leaders hope the full House can pass a budget bill next week before Congress breaks for Memorial Day, but "that is not a slam dunk," said Michael Townsend, managing director, legislative and regulatory affairs at Schwab, in his latest analysis.
Q1 retailers report: Get set for earnings from Walmart, Home Depot (HD) and other retailers sharing results this week and next with Schwab's preview.
Chart of the day
Data sources: CME Group. Chart source: thinkorswim® platform.
Past performance is no guarantee of future results.
For illustrative purposes only.
After a strong bounce off the 52-week low price of $1,387 on April 9, cryptocurrency ether futures (/ETH—candlesticks) have rallied over 80% to the current price of $2,565. It's possible there could be some consolidation and potential resistance just slightly above these levels as futures approach a confluence of both the 50% Fibonacci retracement and the 200-day moving average (purple line). The Relative Strength Index (RSI—below main chart) at 77 could be considered overbought, and may provide an overhang as well.
The week ahead
Check out the Investors' Calendar for a summary of the top economic events and earnings reports on tap this week.
May 15: April PPI and core PPI, April industrial production, April retail sales, and expected earnings from Alibaba (BABA), Walmart (WMT), Deere (DE), Applied Materials (AMAT), and Cava Group (CAVA).
May 16: April housing starts, April building permits, and May preliminary University of Michigan consumer sentiment.
May 19: April leading indicators from the Conference Board
May 20: Expected earnings from Home Depot (HD), Palo Alto Networks (PANW), and Toll Brothers (TOL).
May 21: Expected earnings from Baidu (BIDU), Target (TGT), Lowe's (LOW), Macy's (M), Medtronic (MDT), TJX (TJX), Urban Outfitters (URBN), and Snowflake (SNOW).
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