- U.S. stocks tumble as GDP contracts unexpectedly with the US500 falling 1.09%, US30 dropping 0.85%, and US100 sliding 1.19% after data showed the U.S. economy shrank by 0.3% in Q1 versus expected 0.2% growth, marking the first contraction since 2022.
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Oil prices plummet to four-year lows with WTI crude suffering its largest monthly decline (19%) since November 2021 as U.S.-China trade tensions and potential OPEC+ production increases weigh on the market, pushing prices near $58 per barrel.
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Employment data signals cooling job market as ADP report shows private payrolls increased by just 62,000 in April, significantly below March's downwardly revised 147,000, while JOLTS job openings fell to 7.192 million from 7.48 million.
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Tech stocks lead the selloff with AI server maker Super Micro Computer plunging 15% after cutting Q3 forecasts, while Snap dropped over 14% and other tech names weakened ahead of key earnings from Microsoft and Meta.
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Consumer discretionary shows weakness as Starbucks fell nearly 7% on fifth consecutive quarter of comparable sales declines, while Norwegian Cruise Line sank more than 8% after lowering guidance due to softening demand.
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Solar sector hit by Trump tariffs with First Solar shares tumbling as much as 13% after reducing 2025 earnings guidance due to the impact of recently imposed tariffs, cutting EPS forecast to $12.50-$17.50 from $17-$20 previously.
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Ukraine-U.S. minerals deal imminent as Ukraine prepares to sign a strategic agreement giving the U.S. preferential access to new Ukrainian natural resources deals, though last-minute complications have emerged in finalizing the agreement.
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Economic indicators point to stagflation concerns as GDP contracts while inflation accelerates, with the PCE price index rising to 3.5% from 2.6% in the previous quarter, complicating the outlook for Federal Reserve policy.
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Consumer confidence weakens falling to its lowest level since May 2020 as economic uncertainty and trade tensions impact sentiment, adding to concerns about the resilience of consumer spending which still rose 1.8% in Q1 despite slowing from 4.0% in Q4.
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A continuation of yesterday’s sell-off was seen in gold prices, which are down 0.3% today. Silver is also falling by 0.6%, while platinum is the weakest among precious metals with a 1.4% decline.
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European markets ended the session with mixed sentiment. Most major indices closed higher: Germany’s DAX gained 0.3%, France’s CAC 40 rose 0.5%, while Switzerland’s SMI and the UK’s FTSE 100 ended the day up around 0.4%. On the other hand, Italy’s IT40 dropped more than 1%, and Poland’s WIG index fell over 2%, closing the session below the 100,000-point mark.
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Preliminary inflation data for Germany in April showed a slightly higher-than-expected price increase. The CPI rose 2.1% y/y vs an expected 2% increase. However, this is still lower than last month’s 2.2% reading.
- Eurozone GDP data showed a 0.4% q/q growth, which is 0.2 percentage points higher than the consensus. The data is particularly positive when compared to the surprisingly weak figures from the United States.
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