Opening Comment — Tuesday, May 20, 2025
DJIA: 42,792.07, up 137.33
S&P 500: 5,963.60, up 5.22
NASDAQ: 19,215.46, up 4.36
Stocks mostly lower ahead of Fed speakers
Stock futures are mostly lower Tuesday morning ahead of a slew of Federal Reserve (Fed) speakers scheduled for today. As of 7:15 AM ET, the Dow is little changed, while the S&P 500 is down 0.2%. The Nasdaq 100 is also falling 0.2% relative to fair value on the GLOBEX.
U.S. equities were mostly higher on Monday as markets reacted to Moody’s late-Friday downgrade of the U.S. credit rating from Aaa to Aa1. Investors also reacted to several Fed speakers who suggested further policy rate cuts may not occur for several more meetings as central bankers await additional clarity and data on the economy. Meanwhile, the leading index declined as expected, falling 1.0%. The Dow was up 0.3%, while the tech-heavy Nasdaq Composite was little changed. The S&P 500 increased 0.1% with seven of 11 sectors finishing in positive territory. The Health Care sector was the top performer, rising 1.0%, while the Energy sector was the bottom performer, falling 1.6%.
On the data front, the Philadelphia Fed’s Non-Manufacturing Business Outlook Survey for May will be released today.
Across the pond, European stocks are higher in mid-day trading as Germany’s Producer Price Index showed a larger-than-expected decline for April.
Overnight in Asia, stocks were mostly higher as China’s one- and five-year loan prime rates were both decreased by 10 basis points (0.10%) to 3.00% and 3.50%, respectively. Meanwhile, the Reserve Bank of Australia decreased their cash rate target by 25 basis points (0.25%) to 3.85%.
In FOREX trading, the dollar is slightly lower following rate decisions from China and Australia and as investors continue digesting the downgrade of the U.S. credit rating.
Over in the commodity pits, West Texas Intermediate (WTI) crude oil is 0.2% lower at $62.54/barrel as U.S.-Iran and Russia-Ukraine negotiations continue.
In the metals complex, gold is 0.1% higher at $3,235.30/ounce following a weakening dollar.