On the evening of May 9th, Beijing time, the US stock market opened slightly higher on Friday. High-level economic and trade talks between China and the USA will be held this weekend. The EU announced a 95 billion euro tariff countermeasure list against the USA.
On May 9th, Beijing time, the three major US stock indices opened higher, as of the time of writing, $Dow Jones Industrial Average (.DJI.US)$ up 0.24%, $Nasdaq Composite Index (.IXIC.US)$ up 0.68%, $S&P 500 Index (.SPX.US)$ Increased by 0.43%.
After the ride-hailing company Lyft, chip manufacturer Microchip, and software company Cloudflare released strong earnings data, their stock prices rose.
On Thursday, US stocks rose, but major indexes all pulled back from intraday highs. The Dow Jones Industrial Average was up 0.6%, the S&P 500 Index rose nearly 0.6%, and the Nasdaq Composite Index climbed about 1.1%.
So far this week, the S&P 500 Index has dropped 0.4%, the Nasdaq Index fell 0.3%, and the Dow Jones slightly rose 0.1%, likely to close higher for the third consecutive week.
A market indicator from Bloomberg shows that due to the trade tensions overshadowing financial markets and weakening the profit growth outlook for US companies, the return outlook for the S&P 500 Index has entered a historically poor stage.
The market continues to focus on the uncertainty of Trump's tariffs.
As high-level economic and trade talks between China and the USA are approaching, US President Trump posted on the Truth Social platform on Friday, stating: "A tariff of 80% on China seems appropriate! Ultimately decided by (Treasury Secretary) Scott Bessent."
This weekend, US Treasury Secretary Scott Bessent and other high-ranking US government officials will hold economic and trade talks with senior Chinese officials in Switzerland.
According to a spokesperson from China's Ministry of Commerce, since the new US government took office, it has taken a series of illegal and unreasonable unilateral tariff measures, severely impacting Sino-US economic and trade relations, disrupting international economic and trade order, and posing severe challenges to the global economic recovery. To defend its legitimate rights and interests, China has taken resolute and forceful countermeasures. Recently, senior officials from the USA have continuously conveyed messages about adjusting tariff measures, actively transmitting information to China through various channels, hoping to discuss issues such as tariffs with China. China has seriously evaluated the information from the USA. Based on careful consideration of global expectations, China's interests, and the calls from the US industry and consumers, China has decided to agree to engage in contact with the USA.
Despite Trump's announcement last month to postpone the implementation of new tariff policies for most countries for 90 days, the proposed 145% special tariff has not been adjusted at all.
However, there are recent speculations that the U.S. government may significantly lower tariffs to ease the negotiation deadlock and promote dialogue. Media reports have previously stated that the 145% rate could be reduced to below 60% as early as this week.
Trump's latest statement has shattered market hopes that he might actively lower tariffs. However, it is still unclear whether the suggested 80% tariff is a long-term policy or a temporary measure during negotiations.
The U.S. and the United Kingdom reached a preliminary trade agreement yesterday.
Market sentiment improved this week as Trump announced a framework for a preliminary trade agreement with the UK on Thursday. This marks the first agreement reached by the U.S. with a global trading partner since Trump proposed the "reciprocal tariff" policy last month. Traders hope this agreement will lay the groundwork for the U.S. to quickly reach more agreements with other major countries, even though the 10% tariff on the UK may become a global benchmark.
This "overall framework" agreement maintains the 10% tariff on goods imported from the UK but lowers the high U.S. tariff rate on UK car exports. In exchange, the UK agreed to reduce its tariffs on U.S. goods from 5.1% to 1.8% and allow greater access for U.S. products.
Trump even stated that the 10% rate is the predictable minimum limit for other countries. After announcing the trade agreement with the UK, he said, "The tariff rates for some countries will be much higher because they have substantial trade surpluses."
U.S. Commerce Secretary Ross also stated on Thursday that the 10% tariff imposed on most countries is likely to remain unchanged.
Analysts pointed out that the trade scale between the USA and the United Kingdom is far less than that between the USA and Canada, as well as the USA and Mexico, not to mention compared to Asian countries.
James Rossiter, the global macro strategy chief at Toronto-Dominion Securities, indicated that market optimism has already outpaced reality, stating, "This (USA-UK) trade agreement is not a real trade agreement; it’s just an agreement around a few narrow topics. However, it indicates that some progress has been made, and some tariffs may ease, but will not disappear."
Kyle Rodda, a senior financial market analyst at Capital.com, stated: "The agreement between the USA and the UK is more formal than substantive. However, it reinforces market views that the USA wishes to quickly finalize a series of trade agreements, and partially reduce tariffs and other trade barriers."
Last week, Trump stated that there are also "potential" trade agreements between the USA and India, South Korea, and Japan. Trump denied that the USA-UK agreement is a template for other negotiations, including the planned USA-China talks to be held in the Swiss Franc on Saturday.
The European Union is brewing countermeasures against USA tariffs.
On Thursday, the European Commission announced that if negotiations with Washington fail to eliminate the tariffs imposed by Trump, it plans to take countermeasures against up to 95 billion euros (107.2 billion dollars) of American imports.
The agency stated on Thursday that it would call on the World Trade Organization (WTO) regarding the USA's "reciprocal" tariff policy and the issue of tariffs levied on autos and auto parts.
The European Commission further stated that it has initiated a public consultation on countermeasures against US imports valued at 95 billion euros (107.4 billion dollars), which will be implemented if no trade agreement is reached with Washington.
The list includes hundreds of agricultural products and industrial goods, as well as Bourbon whiskey, tequila, and other spirits - a sore point between the two major trading partners. In March, US President Trump threatened to impose a 200% tariff on EU alcohol imports, without announcing specific retaliatory tariff rates.
The EU is currently seeking to reach an agreement through negotiations to avoid Trump's imposition of a 20% "reciprocal" tariff on all imports from the EU. Trump also imposed a 25% tariff on all imported autos, impacting many European auto manufacturers, as well as a 25% tariff on steel and aluminum.
The EU list released on Thursday also includes numerous planes and auto parts, which will have an adverse effect on US companies like Boeing.
Germany's newly appointed Chancellor Friedrich Merz said he informed US President Donald Trump that the US can only negotiate trade matters with the EU, and cannot make any separate agreements with individual member countries of the EU.
Merz said at a press conference with European Council President Antonio CoStar that he congratulated Trump on his recent trade agreement with the former EU member country, the United Kingdom, 'but I explained to him that it is not possible to do this with other European countries that are EU members, because we can and want to act collectively on trade issues.'
Merz said he felt Trump understood and accepted this fact during their first phone call on Thursday evening. 'I told him that, in my opinion, escalating this trade dispute is not a good idea,' Merz said. 'I firmly believe - zero tariffs is the best.'
Focus Stocks
Most Growth Tech stocks rose. $Tesla (TSLA.US)$ Increased by over 5%, $Apple (AAPL.US)$ 、 $Advanced Micro Devices (AMD.US)$ rose over 1%.
Bitcoin returned to $0.103 million, with all US stocks in the cryptocurrency concept rising. $MARA Holdings (MARA.US)$ Up by 10%. $CleanSpark (CLSK.US)$ Increased by more than 7%, $Strategy (MSTR.US)$ 、 $Coinbase (COIN.US)$ Increased by over 3%.
China Concept Stocks have narrowed their gains, $Alibaba (BABA.US)$ Up 0.76%, $PDD Holdings (PDD.US)$ Up 0.64%, $JD.com (JD.US)$ 、 $XPeng (XPEV.US)$ Rise and fall.
$Tesla (TSLA.US)$ Rising by 6%, with a total market value exceeding 980 billion USD. On the news front, the trade agreement between the USA and the United Kingdom indicates the reduction of tariffs on car imports from the UK, as well as lowering taxes on American Autos in the UK.
$Taiwan Semiconductor (TSM.US)$ The increase narrowed to under 2%, with April revenue rising 48% year-on-year, reaching a new high.
$Pinterest (PINS.US)$ Rising nearly 11%, strong quarterly revenue forecasts have alleviated investors' concerns regarding uncertainties in its platform's advertising spending.
$Wolfspeed (WOLF.US)$ The stock price plummeted by 28% as the revenue forecast for the fiscal year 2026 did not meet expectations.
$Marvell Technology (MRVL.US)$ Increased by 5%, Morgan Stanley confirms there are still large orders for Microsoft AI Chips.
$Cloudflare (NET.US)$ Increased by 9%, strong Q1 performance has led Wall Street to collectively remain bullish.
Editor/Rocky
