U.S. Markets Brief: Stocks Rebound Amid Policy Uncertainty and Earnings Focus

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Index Update

U.S. stock futures edged higher, partially recovering from the previous session’s sharp losses as investors weighed concerns over Federal Reserve independence and unclear economic direction from the Presidential administration. All three major indices were set to open just under 1% higher. The earlier selloff, accompanied by declines in Treasuries and the dollar, followed renewed pressure from President Trump to replace Fed Chair Powell, deepening worries about U.S. asset stability amid trade tensions. On the corporate front, General Electric rose after reporting earnings, while Verizon fell, and Tesla traded slightly lower ahead of its results later in the day.

Market Movers

On Monday, the top gainers were Kodiak Sciences Inc (+8.1%), followed by     Ramaco Resources, Inc (+4.36%). On the contrary               Lixiang Education Holding Co., Ltd (-67.11%) and Patriot National Bancorp Inc (-16.16%) declined the most the same day.

Commodities Update

Oil prices saw a technical rebound, with WTI rising above $63 and Brent nearing $67 per barrel after a previous session decline. Despite the uptick, the outlook remains bearish due to progress in U.S.-Iran nuclear talks, which could restore Iranian oil exports. Market sentiment is also weighed down by economic uncertainty tied to tariffs and unclear U.S. monetary policy, with a recent poll signaling a nearly 50% chance of a U.S. recession. Meanwhile, OPEC+ plans to raise output in May, although some gains may be offset by voluntary cuts.

Gold surged to a record high above $3,490 per ounce, fueled by risk aversion amid rising economic and political uncertainty. Investor concerns escalated after Trump reiterated his criticism of Fed Chair Jerome Powell, raising fears about the Fed’s independence. This comes on top of intensifying trade tensions, particularly with China, following Trump’s investigation into tariffs on critical minerals. Gold has already gained over 30% this year as investors seek safe havens.

Macro Update

The 10-year U.S. Treasury yield remained above 4.4% as investors continued to pull back from U.S. bonds, equities, and the dollar due to rising concerns over economic policy and political stability. President Trump’s renewed calls for rate cuts and criticism of Fed Chair Powell heightened fears of political interference in monetary policy, further undermining confidence in U.S. assets. Ongoing trade tensions, particularly with China, added to the uncertainty as negotiations stalled and rhetoric escalated.

Futures Update

U.S. stock index futures rebounded following a sharp decline in the previous session, as investors looked ahead to earnings from Tesla. The Dow, S&P 500, and Nasdaq futures all posted solid gains. This bounce followed a broad sell-off in the major equity indices, which fell over 2% amid rising tensions around U.S. economic policy.

After a disappointing performance at the end of the previous week, stocks experienced a significant decline during trading on Monday. All major averages fell sharply, with the S&P 500 dropping by 124.50 points, or 2.4%, to close at 5158.20. From a technical standpoint, the index is currently hovering near crucial horizontal support levels, suggesting the potential for a rebound in the near future. Additionally, the 14-period Relative Strength Index (RSI) has remained below the midpoint, indicating that while the market is experiencing downward pressure, there may be opportunities for an upside correction. The key support level is positioned at 5115, while resistance is identified at 5160.