Stock Market Update

The stock market is poised for a higher opening this morning following Friday's slide that saw the major averages close the week in negative territory.

The S&P 500 and Nasdaq Composite eclipsed new record-high intraday levels last Thursday, but stocks faced pressure on Friday following a combination of softened economic data, the FOMC decision to keep interest rates unchanged, the announcement of new tariff rates, and some perceived weakness in several mega-cap stocks following earnings.

Bloomberg reports that President Trump will announce a new Federal Reserve Governor to replace Adriana Kugler in the coming days, which could accelerate the president's nomination of the next Fed Chair.

There are no major developments on the trade front following the announcement of higher rates for several key trading partners last Thursday evening, though Financial Times reports that Canada is still hopeful it can strike a deal with the U.S., with President Trump and Canadian Prime Minister Mark Carney set to speak this week.

While this week is heavy with earnings reports, it will not feature any mega-cap companies, which were a key driver of last week's action. 

Economic data is markedly lighter this week, with June Factory Orders at 10:00 ET the lone report today.

In corporate news:

• Apple (AAPL 203.96, +1.58, +0.7%) is reportedly developing an in-house AI "answer engine" to rival OpenAI's ChatGPT, according to Bloomberg.
• Tyson Foods (TSN 54.44, +1.91, +3.6%) beat EPS expectations by $0.11, beat revenue expectations, and raised its FY25 revenue outlook.
• HNI Corporation (HNI) to acquire Steelcase (SCS 14.55, +4.37, +42.9%) for total consideration of approximately $2.2 billion.
• Spotify (SPOT 658.40, +31.25, +5.0%) is trading higher in the pre-market after announcing it will raise premium subscription prices in September.

Reviewing overnight developments:

Equity indices in the Asia-Pacific region began the week on a mostly higher note while Japan's Nikkei (-1.3%) fell to its lowest level in nearly two weeks. Japan's Nikkei: -1.3%, Hong Kong's Hang Seng: +0.9%, China's Shanghai Composite: +0.7%, India's Sensex: +0.5%, South Korea's Kospi: +0.9%, Australia's ASX All Ordinaries: +0.1%.

In news:

• Japan's Prime Minister Ishiba said that the Japanese government is ready to compile an extra budget if necessary.
• The Wall Street Journal reported that China is holding back the supply of critical minerals to Western defense contractors.
• Officials from Japan and South Korea said that trade deals with the U.S. are not on paper yet and that details still need to be ironed out.

In data:

• Japan's July Monetary Base -3.7% yr/yr (last -3.3%)
• Australia's July MI Inflation Gauge 0.9% m/m (last 0.1%)

Major European indices trade in the green. STOXX Europe 600: +0.6% Germany's DAX: +1.1%, U.K.'s FTSE 100: +0.3%, France's CAC 40: +0.8%, Italy's FTSE MIB: +1.8%, Spain's IBEX 35: +1.2%.

In news:

• BP announced that it made its largest oil and gas discovery in 25 years off the coast of Brazil.
• There are growing expectations that the Bank of England will start implementing 25-basis point cuts to its bank rate on a quarterly basis.
• Switzerland's President Keller-Sutter said that her government reached out to the Trump administration after the U.S. announced a 39% tariff on imports from Switzerland.

In economic data:

• Eurozone's August Sentix Investor Confidence -3.7 (expected 6.2; last 4.5)
• Spain's July Unemployment Change -1,400 (expected -21,300; last -48,900)
• Swiss July CPI 0.0% m/m (expected -0.2%; last 0.2%); 0.2% yr/yr (expected 0.1%; last 0.1%). July Manufacturing PMI 48.8 (expected 49.8; last 49.6)