U.S. Stocks Advanced Amid Skepticism About Trade Deal Claims

Barry Adams
08 May, 2025
New York City

U.S. market indexes advanced for the second consecutive day amid claims of progress on trade agreements. and positive earnings. 

The S&P 500 index edged up 0.2%, and the Nasdaq Composite advanced 0.4% as investors bid up artificial intelligence-linked semiconductor stocks.

However, gains on Wall Street were muted after the Federal Reserve announced its rate decisions on Wednesday and issued cautious comments. 

The Federal Reserve held the fed funds rate range between 4.25% and 4.50% and decided to take a wait-and-see approach on the proposed tariffs by the Trump administration. 

At a press conference after the rate decisions, Fed Chair Jerome Powell ruled out the preemptive rate cut to soften the impact of sky-high import taxes announced by the Trump administration and supported by the Republican Congress. 

If the proposed tariffs were implemented, they could slow down U.S. economic growth, reignite inflation, and elevate long-term unemployment, added Powell.

Investors have been holding out for swift progress on US-China tariff discussions in Switzerland amid a sharp slowdown in container ship bookings. 

US-China trade talks are likely to show little progress, as the Trump administration has still not set priorities and a demand list. Moreover, China has lined up suppliers in Brazil, Argentina, and Peru for its agricultural product imports. 

Investors remained skeptical about the proposed US-UK comprehensive trade deal, which is short on details and long on future promises. 

However, the base tariff rate of 10% on the goods imported from the U.K. will remain in place.  

Container shipping companies in China are signaling a sharp decline of 60% in bookings for container shipments compared to June departures, as many factories in China are experiencing order cancelations from U.S. importers.  

The makers of  consumer goods in Ningbo, Dongguan, Suzhou, and Shenzhen have started laying off manufacturing staff and curtailed business operations to only three days a week, according to several companies interviewed by Ticker.com. 

So far, the impact of higher tariffs on four key trading partners—Mexico, Canada, Japan, and China—has not been felt by U.S. consumers, employees, and logistics companies. 

U.S. weekly jobless claims for the week ending May 3 declined 13,000 to 228,000, according to the latest update from the U.S. Department of Labor. 

The continuing claims, tracking longer-term jobless claims, which runs one week behind, also eased 29,000 to 1.88 million. 

 

Commodities, Currencies, Indexes, Yields

The S&P 500 index increased 0.6% to 5,663.03, the Nasdaq Composite edged up 0.8% to 17,877.05, and the Russell 2000 index advanced 1.4% to 2,011.41.

The yield on 2-year Treasury notes edged higher to 3.82%, 10-year Treasury notes increased to 4.30%, and 30-year Treasury bonds advanced to 4.78%.

WTI crude oil increased $1.13 to $59.20 a barrel, and natural gas prices edged higher by $0.02 to $3.64 a thermal unit.

Gold decreased by $13.78 to 3,363.24 an ounce, and silver edged up by $0.07 to $32.52.

The dollar index, which weighs the US currency against a basket of foreign currencies, increased by 0.33 to 99.94, and it traded at the lowest level since April 2022.

 

U.S. Stock Movers

Arm Holdings PLC decreased 7.8% to $114.40 after the advanced chip designer estimated fiscal first quarter adjusted earnings per share between 30 cents and 38 cents, sharply lower than market expectation of at least 43 cents. 

AppLovin Corp. surged 13% to $343.03, and the mobile game developer studio and platform operator reported better-than-expected quarterly results. 

Moreover, the company said it has agreed to sell its mobile gaming business to Tripledot Studios for about $400 million in cash and a 20% equity stake in the company. 

Skyworks Solutions declined 2.5% to $65.30 despite the semiconductor company reporting better-than-expected quarterly earnings and forecasting upbeat earnings for the fiscal third quarter.