Market overview: A Week of Fluctuations

The stock market experienced a mixed start to the week, heavily influenced by developments in global trade and economic data. Investors closely monitored new tariff announcements and their potential impact on the economy.

• The S&P 500 declined by 0.2%.
• The Nasdaq Composite fell approximately 0.3%.
• The Dow Jones Industrial Average, however, rose by 115 points, or nearly 0.3%.

Economic Data Provides a Silver Lining

The major indexes recovered some losses following the release of data from the Institute for Supply Management (ISM). The data indicated stronger-than-expected service sector activity in April. Despite this positive sign, company executives expressed growing concerns about the potential impact of tariffs on their businesses.

Earlier in the day, the Dow had fallen as much as 253.99 points, while the S&P 500 and Nasdaq each dropped around 1% before staging a rebound.

International trade Developments: India’s Proposal

Market sentiment received a boost from a report by Bloomberg, which cited sources indicating that India had proposed eliminating tariffs on steel, auto components, and pharmaceuticals on a reciprocal basis, up to a specified import volume. This proposal offered a glimmer of hope amid ongoing trade uncertainties.

Uncertainty Persists: The Tariff Timeline

Investors remain cautious due to the uncertain timeline for reaching trade agreements between the U.S. and its trading partners. The lack of clarity continues to weigh on market sentiment.

Official Statements: Optimism Tempered by Reality

Treasury Secretary Scott Bessent told CNBC that we’re very close to some deals, echoing President Trump’s earlier statements suggesting that agreements could be reached as early as this week.

however, Trump also stated that we’re negotiating with many countries, but at the end of this, I’ll set my own deals — because I set the deal, they don’t set the deal. He added that he has no immediate plans to meet with Chinese President Xi Jinping, diminishing hopes for a swift resolution to U.S.-China trade tensions.

New Tariffs on Foreign Films: A National Security Concern?

President Trump authorized government agencies to begin imposing a 100% tariff on films produced abroad, citing efforts by other nations to attract film productions as a national security threat. The scope of these tariffs remains unclear, specifically whether they will apply to movies shown in theaters or those available on streaming services.

Shares of Walt Disney and Netflix,both of which film internationally,experienced declines on Monday.

Expert analysis: Concerns Over Trade Deal Delays

Jeremy Siegel, finance professor at the University of Pennsylvania’s wharton School of Business and Wisdom Tree chief economist, expressed concern over the lack of progress in trade negotiations, stating, I am worried, I was hoping trade deals would be announced by now. They’re not.I don’t think the impact has hit us yet.

Looking Ahead: The Federal Reserve’s Policy Meeting

Wall Street is keenly anticipating the Federal Reserve’s two-day policy meeting, which begins on Tuesday. A rate decision is expected on Wednesday. According to the CME Group’s FedWatch tool, Fed funds futures trading indicates only a 3.2% chance of a rate cut.

traders will be closely monitoring any commentary from the central bank or Fed Chair Jerome Powell regarding the economic outlook, particularly considering the heightened uncertainty stemming from the ongoing trade war.

Recent Market Performance: A Winning Streak Interrupted

Last week, market sentiment was buoyed by optimism surrounding potential trade agreements with major trading partners. The S&P 500 advanced nearly 1.5% on Friday, marking its ninth consecutive day of gains—the longest winning streak since November 2004.