Welcome to Markets on Monday, where we preview what's going on in the stock market this week.
So much for those record highs of last week. The market is off to a rough start Monday after President Donald Trump said in a tweet Sunday that the U.S. will hike tariffs on goods imported from China—sparking investor concerns that an anticipated trade deal is off the table.
Barring any last-minute detours, investors will also have the opportunity in the coming days to hop on one of the most highly anticipated initial public offerings in years when Uber arrives. Investors will also be monitoring corporate earnings and economic data this week:
Trade talk worries escalate
Investors have been waiting on a trade deal with China, and negotiations between the U.S. and Beijing officials are on the calendar for Wednesday. But in tweets Sunday, President Trump said the current 10% levies on $200 billion in Chinese goods will rise to 25% on Friday—and that the U.S. will also impose 25% levies on an additional $325 billion of Chinese goods “shortly.”
After those threats, it’s as yet unclear whether those talks are still a go, and if they occur, what the outcome might be. Wall Street insiders are watching closely to see how a derailed deal could affect the market.
Your Uber is here
The ride-share company is expected to offer shares to investors later this week, with the ticker “UBER.” This is the latest in what’s shaping up to be a busy year for IPOs. Last week, Beyond Meat debuted on the stock market and surged 163% in its first day of trading.
But another IPO—Lyft, one of Uber’s main competitors—hasn’t been so rewarding for investors. Shares of Lyft have slumped more than 20% since its IPO in April. So investors are watching closely to see if Uber will do better.
Earnings season shaping up to be better than expected
More than half of the companies in the S&P 500 have reported their results for the first quarter—and those have generally been better than analyst estimates. The multiweek period known as earnings season continues this week, when investors will get reports from companies including Disney and Marriott.
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Prices are going up—but just how much?
On Friday, investors will get a report on inflation, detailing the prices U.S. consumers paid in April for everything from housing to food. In March, prices increased the most they had in more than a year, though the tame inflation backdrop supports the Federal Reserve’s decision to hold off on raising interest rates this year. Central bankers left rates unchanged after their meeting last week, citing “muted inflation pressures.” But investors will be watching for any change on that front.
Meanwhile, oil prices have been a bit choppy lately—falling as much as 4% last Thursday—so investors will be keeping an eye on that, as well.
(Senior editor Kelli Grant contributed to this story.)
May 6, 2019