US Stock Outlook | Three Major Index Futures Rise Together as Trump Sets Date for Tariff Rates

Pre-Market Market Trends

1. As of May 16 (Friday) pre-market, U.S. stock index futures are all up. As of the time of writing, Dow futures are up 0.24%, S&P 500 futures are up 0.27%, and Nasdaq futures are up 0.27%.

1. As of the time of writing, the German DAX index is up 0.66%, the UK FTSE 100 index is up 0.44%, the French CAC40 index is up 0.57%, and the Euro Stoxx 50 index is up 0.48%.

1. As of the time of writing, WTI crude oil is up 0.19%, priced at $61.74 per barrel. Brent crude oil is up 0.31%, priced at $64.73 per barrel.

Market News

After the easing of the China-U.S. trade war, Wall Street quickly tears up "bearish research reports"! Optimism about the U.S. economy and stock market outlook has turned. A research report released by Barclays stated that, given the significant signs of easing in China-U.S. trade tensions, the bank no longer expects the U.S. economy to fall into recession in the second half of this year and has significantly raised its growth forecast for the U.S. economy this year. Barclays' team of economists has joined the ranks of major Wall Street firms like Goldman Sachs and JP Morgan—no longer pessimistic about the U.S. economy in 2025 and lowering the probability of a U.S. recession, while becoming much more optimistic about the outlook for U.S. stocks; Barclays now expects the U.S. economy to grow by 0.5% this year and by 1.6% next year, up from previous forecasts of -0.3% and 1.5% growth, respectively. Regarding U.S. economic growth expectations, similarly, after reaching a trade consensus and agreeing to significantly reduce tariffs, Goldman Sachs' team of economists expects the U.S. economy to grow by 1% in 2025, an increase of 0.5 percentage points from Goldman Sachs' previous forecast, and has lowered the probability of a domestic economic recession in the next 12 months from 45% to 35%.

Federal Reserve's Barr: Tariffs may disrupt supply chains or raise inflation, increasing survival risks for small and medium-sized enterprises. Federal Reserve Governor Michael Barr recently spoke at an economic seminar at the New York Fed, pointing out that although the current fundamentals of the U.S. economy remain robust, the potential supply chain fluctuations caused by trade policy adjustments still require close attention. He emphasized that if tariff measures lead to supply chain disruptions, it may simultaneously bring about the dual risks of slowing economic growth and increasing inflationary pressures. In terms of policy recommendations, while Barr did not directly mention specific measures, he emphasized the importance of policy transparency and stable expectations. He called for trade policy formulation to fully consider the impact on microeconomic entities, especially to allow sufficient buffer periods and adaptation space for small and medium-sized enterprises, to avoid " Policy changes "intensify market volatility."

Federal Reserve officials "douse cold water": expect the economy will not recession, may cut interest rates once this year! Atlanta Federal Reserve President Raphael Bostic stated that he expects the U.S. economy to slow down this year but will not fall into recession, and reiterated that he believes there may be one interest rate cut in 2025. He does not have a vote in the FOMC this year. Bostic mentioned that U.S. economic growth this year could reach 0.5% or 1%, as uncertainty and concerns about the economic outlook are putting pressure on consumers. He pointed out that fluctuating trade policies have also made businesses less willing to make significant decisions. "I think there will be one interest rate cut this year. Part of the reason is that I believe uncertainty is unlikely to dissipate quickly." In contrast, the market currently expects the Federal Reserve to cut interest rates at least twice this year to prevent a recession. Additionally, Bostic noted that although the implementation of the so-called "tariff treatment" has been delayed by 90 days, the latest U.S.-China trade tensions have eased somewhat, but the final outcome of negotiations remains unclear.

Trump: Will set tariff rates for other countries in the next two to three weeks. Trump stated on Friday that he will "set tariff rates for U.S. trading partners in the next two or three weeks," and claimed that his administration cannot negotiate agreements with all trade partners. Trump mentioned that Treasury Secretary Mnuchin and Commerce Secretary Ross "will send out letters essentially telling everyone how much they need to pay to do business with the U.S." Trump stated, "I think we will be very fair. But we cannot meet with everyone who wants to meet with us." Trump claimed that "150 countries want to reach agreements," but he did not specify which countries would receive the letters.

"Vulture Fund" king sounds alarm: Trump's policies may trigger capital flight from the U.S. Elliott Management, a U.S. "vulture fund," warned that Trump's trade war could trigger capital flight from the U.S., as his unpredictable tariff policies are causing "significant" damage. The firm stated that the economic plans of the Trump administration could weaken the attractiveness of the dollar and the willingness of companies to do business in the U.S. The firm claimed that the tariffs being considered by the Trump administration "could be harsher than the tariffs that exacerbated the Great Depression in the 1930s," and "such tariffs would subject global companies to long and complex negotiations, leading to retaliation and uncertainty," potentially causing "significant" damage.

Individual Stock News

Cloud of export controls looms, Applied Materials (AMAT.US) Q3 revenue outlook bleak. The financial report showed that for the second fiscal quarter ending April 27, the company’s revenue grew by 7% year-on-year to $7.1 billion, slightly below the average analyst expectation of $7.13 billion, while adjusted earnings per share of $2.39 exceeded the analyst forecast of $2.31. Among them, the semiconductor systems segment, which is the company's revenue pillar, contributed $5.26 billion in revenue this quarter, lower than the widely expected $5.32 billion by analysts. The company's management pointed out that the slowdown in investment in the Internet of Things, communications, automotive, power, and sensors (ICAPS) markets has dragged down performance, but significant investments in advanced process chips partially offset this impact. Meanwhile, the company also provided a bleak performance outlook, highlighting the ongoing impact of the U.S.-China trade dispute on businesses Looking ahead, it is expected that third-quarter revenue will fluctuate around $7.2 billion within a range of $500 million. Although this forecast is generally in line with Wall Street expectations, some analysts had previously estimated it could be as high as $7.4 billion. As of the time of writing, Applied Materials fell nearly 6% in pre-market trading on Friday.

RLX Technology (RLX.US) Q1 revenue increased by 47% year-on-year, and net profit increased by 21% year-on-year. Data shows that the company's Q1 revenue was 808 million yuan (RMB, the same below), a year-on-year increase of 46.5%, better than market expectations; Non-GAAP net profit was 251 million yuan, a year-on-year increase of 21.0%; Non-GAAP basic and diluted earnings per ADS were 0.204 yuan and 0.191 yuan, respectively, compared to 0.166 yuan and 0.159 yuan in the same period last year. RLX Technology stated that the revenue growth in the first quarter was mainly due to international expansion. As of the time of writing, RLX Technology rose over 4% in pre-market trading on Friday.

Trump visits the UAE for "talks," GE Aerospace (GE.US) teams up with Boeing (BA.US) to secure a $14.5 billion order. Trump announced that a deal worth over $200 billion has been reached between the U.S. and the UAE, which includes a $14.5 billion procurement commitment between Etihad Airways and Boeing, as well as General Electric Aerospace. The White House stated that Boeing and General Electric have received a procurement intention from Etihad Airways, which will spend $14.5 billion to purchase 28 Boeing 787 and 777X passenger aircraft made in the U.S., which will be equipped with General Electric engines.

Meta (META.US) flagship AI model Behemoth's release delayed, raising market concerns. Meta is facing a crisis of market confidence due to setbacks in the development of its flagship artificial intelligence model "Behemoth." According to internal sources, the company's engineers encountered technical bottlenecks while optimizing this ultra-large language model with two trillion parameters, and the planned release in June has been postponed to the fall or even later. As the core of Meta's new generation AI strategy, "Behemoth" in the Llama 4 series model was highly anticipated. It is worth noting that this delay exposes the common dilemma faced by large tech companies in the AI arms race. Although Meta made a high-profile release of the Llama 4 series in April, the commercialization of the core model still needs to overcome engineering challenges. According to informed sources, the R&D team is focusing on improving model stability and output consistency, two metrics that did not meet expected standards in early testing.

Some popular Chinese concept stocks rose in pre-market trading. As of the time of writing on Friday, in pre-market trading, ZTO Express (ZTO.US) rose nearly 10%, Bilibili (BILI.US) and BOSS Zhipin (BZ.US) rose over 4%, Nio (NIO.US) rose over 2%, New Oriental (EDU.US) and Alibaba (BABA.US) rose nearly 2%, and Pinduoduo (PDD.US) and GDS Holdings (GDS.US) rose over 1%.

Important Economic Data and Event Forecast

Beijing time 20:30 US April building permits month-on-month preliminary value

Beijing time 20:30 US April import price index month-on-month

Beijing time 20:30 US April housing starts annualized month-on-month

Beijing time 22:00 US May University of Michigan consumer confidence index preliminary value