Opening Comment — Tuesday, May 13, 2025
DJIA: 42,410.10, up 1,160.72
S&P 500: 5,844.19, up 184.28
NASDAQ: 18,708.34, up 779.42
Stocks lower ahead of CPI release
Stock futures are lower Tuesday morning as investors are awaiting today’s Consumer Price Index (CPI) data release for April. Meanwhile, a reading of small business optimism declined less-than-expected. As of 7:15 AM ET, the Dow is decreasing 0.5%, while the S&P 500 is down 0.2%. The Nasdaq 100 is falling 0.1% relative to fair value on the GLOBEX.
U.S. equities were higher on Monday following news that the U.S. and China had agreed to a 90-day reduction of tariffs as trade negotiations continue. The U.S. government recorded a slightly stronger-than-anticipated federal budget surplus of $258.4 billion for April following tax filings, as tariffs contributed $16 billion. The Dow was up 2.8%, while the tech-heavy Nasdaq Composite rose 4.4%. The S&P 500 increased 3.3% with 10 of 11 sectors finishing in positive territory. The Consumer Discretionary sector was the top performer, rising 5.7%, while the Utilities sector was the bottom performer, falling 0.7%.
On the data front, the National Federation of Independent Business’s gauge of small business optimism declined to 95.8 in April from the prior month’s 97.4. The headline CPI for April is expected to show price increases of 0.3% month-over-month (MOM) and 2.4% year-over-year (YOY) versus the prior month’s decline of 0.1% and increase of 2.4%, respectively. Meanwhile, core CPI is expected to show price increases of 0.3% MOM and 2.8% YOY, versus the prior month’s increases of 0.1% and 2.8%, respectively. Data on April’s average hourly and weekly earnings is also scheduled for release.
Across the pond, European stocks are higher in mid-day trading as the U.K.’s unemployment rate rose to 4.5% and average weekly earnings growth decelerated less than projected in March. Meanwhile, the country’s jobless claims slowed in April. The ZEW measure of expectations for German economic growth rose more than expected in May.
Overnight in Asia, stocks were mostly higher as India proposed tariffs on the U.S. in response to the latter’s steel and aluminum duties. Westpac’s Consumer Confidence Index for Australia rose by 2.2% in May, while National Australia Bank’s Business Confidence Index improved slightly in April. Japan’s M2 money supply (a measure of the total amount of money in circulation) increased by 0.5% YOY in April, while M3 (a broad measure of the money supply) grew by 0.1%.
In FOREX trading, the dollar is lower as investors await today’s U.S. CPI reading
Over in the commodity pits, West Texas Intermediate (WTI) crude oil is 0.8% higher at $62.44/barrel following continued optimism from the U.S.-China tariff reductions outweighing ongoing concerns of oversupply.
In the metals complex, gold is 0.9% higher at $3,257.00/ounce following a weakening dollar.