June S&P 500 E-Mini futures (ESM25) are trending up +0.32% this morning as investors pin their hopes on trade negotiations between Washington and Beijing.

Investors are eagerly awaiting the upcoming trade talks between the U.S. and China, set to take place in Switzerland this weekend, which President Trump expects to be “substantive.” U.S. Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer are set to meet with Chinese Vice Premier He Lifeng. Trump stated that if the talks go well, he may consider reducing the 145% tariff he has imposed on numerous Chinese goods.

Bloomberg reported on Friday that the U.S. side has set an initial goal of lowering tariffs to below 60%, a move they believe China may be willing to match. Progress during the two days of scheduled talks could lead to those tariff reductions being implemented as early as next week, according to the report.

“As we ... find out how much progress the U.S. and China are making towards the most important trade deal this weekend, it should give investors some more clarity about how much of an impact the trade issue will have on the U.S. and global economy going forward,” said Matt Maley at Miller Tabak + Co.

In yesterday’s trading session, Wall Street’s major indices closed higher. Axon Enterprises (AXON) surged over +14% and was the top percentage gainer on the S&P 500 and Nasdaq 100 after the company posted upbeat Q1 results and raised its full-year revenue guidance. Also, chip stocks advanced after the Commerce Department said it doesn’t intend to implement the AI Diffusion rule, with Intel (INTC) and Micron Technology (MU) rising more than +3%. In addition, Applovin (APP) climbed over +11% after the digital advertising company reported stronger-than-expected Q1 results and provided upbeat Q2 advertising revenue guidance. On the bearish side, Match Group (MTCH) slid more than -9% and was the top percentage loser on the S&P 500 after the company issued below-consensus Q2 adjusted operating income guidance and announced a 13% workforce reduction.

The Labor Department’s report on Thursday showed that the number of Americans filing for initial jobless claims in the past week fell -13K to 228K, compared with the 231K expected. Also, U.S. Q1 nonfarm productivity fell -0.8% q/q, weaker than expectations of -0.4% q/q, while unit labor costs climbed +5.7% q/q, stronger than expectations of +5.3% q/q. In addition, U.S. March wholesale inventories were revised slightly lower to +0.4% m/m from the advance estimate of +0.5% m/m.

Meanwhile, U.S. rate futures have priced in an 83.0% chance of no rate change and a 17.0% chance of a 25 basis point rate cut at the next FOMC meeting in June.

The U.S. economic data slate is empty on Friday. However, investors will focus on a batch of speeches from Fed officials Williams, Kugler, Barkin, Goolsbee, Waller, and Cook.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.372%, down -0.02%.

The Euro Stoxx 50 Index is up +0.32% this morning as sentiment improved following Thursday’s trade agreement between the U.S. and U.K., along with cautious optimism over the potential for a U.S.-China trade deal. Energy, automobile, and healthcare stocks gained ground on Friday. The benchmark index is on track to post modest gains for the week. Data from the statistics agency Istat released on Friday showed that Italy’s monthly industrial production edged up in March. Meanwhile, the U.S. signed a framework for a trade agreement with the U.K. on Thursday, keeping the 10% tariff on imports from the U.K. in place, while the U.K. agreed to reduce its tariffs from 5.1% to 1.8%. Shortly after the announcement, U.S. Commerce Secretary Howard Lutnick told CNBC that Washington plans dozens of trade deals over the next month. That boosted optimism about the prospects of an EU-U.S. trade agreement. Investors are also awaiting the outcome of the weekend trade talks between the U.S. and China. On the monetary policy front, ECB Governing Council members Olli Rehn and Gediminas Simkus stated on Friday that a rate cut is likely to come in June. In corporate news, Sonova Holding AG (SOON.Z.IX) climbed more than +4% after the Swiss hearing aid manufacturer projected higher full-year sales and profitability.

Italy’s Industrial Production data was released today.

The Italian March Industrial Production came in at +0.1% m/m, weaker than expectations of +0.4% m/m.

Asian stock markets today settled mixed. China’s Shanghai Composite Index (SHCOMP) closed down -0.30%, and Japan’s Nikkei 225 Stock Index (NIK) closed up +1.56%.

China’s Shanghai Composite Index closed lower today as investors cautiously awaited the upcoming trade talks between the world’s two largest economies. Semiconductor stocks underperformed on Friday. However, the benchmark index ended the week higher. The caution emerged as U.S. Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer are scheduled to meet with Chinese Vice Premier He Lifeng in Switzerland for trade negotiations during the weekend. U.S. President Donald Trump stated on Thursday that he believed the negotiations would lead to tangible progress. Still, analysts noted that expectations remain low for the two sides to strike a quick agreement in the near future. In another indication of lingering investor caution, markets largely ignored the latest data showing that China’s exports exceeded expectations in April, even as shipments to the U.S. dropped significantly in the first month following Trump’s imposition of hefty tariffs on Chinese goods. Meanwhile, China’s Vice Foreign Minister Hua Chunying stated on Friday that the country remains fully confident in its ability to handle trade matters with the U.S. Beijing unveiled a slew of measures this week aimed at stimulating the economy and restoring confidence in China’s private sector to offset the impact of the tariffs. Bloomberg News reported on Thursday that Beijing was weighing a major change to its home sales system by mandating developers to sell only completed homes, replacing the current presale model. In corporate news, Hua Hong Semiconductor plunged over -9% after the country’s leading chipmaker posted a sharp drop in Q1 profit.

The Chinese April Trade Balance stood at $96.18B, weaker than expectations of $97.00B.

The Chinese April Exports came in at +8.1% y/y, stronger than expectations of +1.9% y/y.

The Chinese April Imports arrived at -0.2% y/y, stronger than expectations of -5.9% y/y.

Japan’s Nikkei 225 Stock Index closed higher and hit a 6-week high today as sentiment was boosted by a U.S. trade agreement with Britain that fueled optimism for progress in negotiations with other nations. Chip and financial stocks led the gains on Friday. The benchmark index notched its fourth consecutive weekly gain. Government data released on Friday showed that Japanese real wages declined for the third straight month in March, pressured by persistent inflation, but consumer spending rose much more than expected. Separately, preliminary data from the Cabinet Office showed that Japan’s leading economic indicators index, which gauges the economic outlook for a few months ahead based on data such as job offers and consumer sentiment, fell to a 4-month low in March. Meanwhile, Japan’s chief trade negotiator Ryosei Akazawa stated that Japan and the U.S. have agreed to work toward finalizing a deal as soon as possible that can be announced by their respective leaders. Akazawa emphasized that Japan’s position remains unchanged, as it will keep pushing for a reconsideration of the various tariff measures. He declined to comment on U.S. Commerce Secretary Howard Lutnick’s statement that the U.S.-Japan trade negotiations would require an “enormous amount of time.” Investor focus is now on the outcome of the weekend trade talks between the U.S. and China. In corporate news, NTT Data jumped over +14% after NTT announced plans to take the subsidiary private by acquiring the remaining shares it does not already own at 4,000 yen per share. Also, Ajinomoto climbed more than +7% after the food and healthcare company announced a 100 billion yen ($686.2 million) share buyback. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed down -12.62% to 24.58.

The Japanese March Household Spending stood at +0.4% m/m and +2.1% y/y, stronger than expectations of -0.5% m/m and +0.2% y/y.

The Japanese March Leading Index arrived at 107.7, stronger than expectations of 107.4.

Pre-Market U.S. Stock Movers

The Trade Desk (TTD) surged over +13% in pre-market trading after the advertising-technology company reported stronger-than-expected Q1 results and gave solid Q2 revenue guidance.

Cloudflare (NET) jumped more than +10% in pre-market trading after the cybersecurity company posted better-than-expected Q1 revenue.

Microchip Technology (MCHP) climbed over +10% in pre-market trading after the maker of chips and circuits for electronics reported stronger-than-expected FQ4 results and provided solid FQ1 revenue guidance.

Pinterest (PINS) rose more than +13% in pre-market trading after reporting better-than-expected Q1 revenue.

Affirm Holdings (AFRM) slumped more than -7% in pre-market trading after the buy now, pay later company issued soft FQ4 revenue guidance.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Friday - May 9th

Enbridge (ENB), TELUS (TU), Plains All American Pipeline (PAA), EchoStar (SATS), Starwood Property (STWD), Essent Group Ltd (ESNT), Construction Partners (ROAD), TXNM Energy (TXNM), Plains GP Holdings (PAGP), Algonquin Power (AQN), PAR Technology (PAR), Sylvamo (SLVM), Kymera (KYMR), Federal Agricultural Mortgage (AGM), Nextnav Acquisition (NN), Hawaiian Electric Industries (HE), Alpha Metallurgical Resources (AMR), BKV (BKV), Federal Agricultural Mortgage (AGMa), ANI Pharma (ANIP), Terawulf (WULF), Docebo (DCBO), Calumet (CLMT), Gogo (GOGO).