Wall Street to Open Lower Amid S&P 500 Streak, Fed Meeting, Disney Earnings, and Trump's Film Tariffs

US • Business • 05/05 13:30
Wall Street to Open Lower Amid S&P 500 Streak, Fed Meeting, Disney Earnings, and Trump's Film Tariffs

Wall Street is expected to open lower on Monday, May 5, after the S&P 500's nine-day winning streak, the longest since 2004. The index's rise was driven by strong corporate earnings and a positive April jobs report. However, investor focus has shifted to renewed trade tensions, a Federal Reserve meeting, Disney's earnings, and Warren Buffett's leadership transition at Berkshire Hathaway. Additionally, former President Donald Trump announced a 100% tariff on foreign films, impacting media stocks. The Federal Reserve is anticipated to maintain interest rates, with investors watching for future economic guidance.

Key Updates

05/06 19:02

U.S. Apple Juice Supply Chain Crisis: Trump Tariffs on Chinese Imports Cause Cost Surge and Disruptions

The U.S. apple juice supply chain faces disruption due to a 145% tariff on Chinese apple juice concentrate imposed by the Trump administration. China, historically the main supplier, has seen its exports to the U.S. drop, leading importers to seek alternatives like Turkey. However, Turkey's capacity is limited, causing increased competition and prices. Domestic production cannot quickly fill the gap, and costs for apple juice and related products are rising. This situation highlights the broader impact of protectionist trade policies on consumer goods.

05/06 17:01

U.S. Trade Deficit Reaches Record $140.5 Billion in March 2025 Amid Pre-Tariff Import Surge; Chinese Imports Decline

The U.S. trade deficit reached a record $140.5 billion in March 2025, driven by a surge in imports as businesses stockpiled goods before new tariffs by President Trump. Imports rose 4.4% to $419 billion, while exports increased 0.2% to $278.5 billion. Imports from China fell to a five-year low due to 145% tariffs, while imports from other countries like Ireland and Vietnam increased. The data, released by the Commerce Department, highlights shifts in trade flows as companies adjust to the new tariff landscape.

05/06 02:31

Warren Buffett Warns on Utility Stocks at Berkshire Meeting; Shares Drop Over 5% as Ackman Plans Buffett-Inspired Strategy

Warren Buffett warned about risks in utility stocks at Berkshire Hathaway's 60th annual meeting, citing wildfires as a threat. He confirmed Greg Abel will succeed him as CEO on January 1, 2026. Berkshire shares fell over 5% after the announcement. Bill Ackman plans to emulate Buffett's model with Howard Hughes Holdings. New U.S. tariffs on imported auto parts began on May 3, 2025, under President Trump's directive, affecting the automotive sector. Automakers are concerned about increased costs and supply chain disruptions, with some seeking exemptions.

05/06 00:31

Mattel to Increase U.S. Toy Prices and Shift Manufacturing from China Due to Tariffs

Mattel Inc. plans to raise prices on some U.S. toys due to a 145% tariff on Chinese imports, part of President Trump's trade policy. CEO Ynon Kreiz stated the company will adjust prices to offset costs, with some products already seeing increases. Mattel is also reducing reliance on Chinese manufacturing, aiming to lower China's production share to below 40% by 2025. Despite a 2% sales increase in Q1, Mattel reported a $40.3 million loss and withdrew its full-year earnings forecast due to trade policy uncertainties.

05/05 22:31

West Coast Ports Struggle as 145% Tariff on Chinese Goods Cuts Shipping Volumes

The ports of Los Angeles and Long Beach are experiencing a significant decline in business due to a 145% tariff on Chinese imports, enacted by President Donald Trump in early April. This has led to canceled sailings, reduced container volumes, and uncertainty among shippers. Port officials, including Gene Seroka and Mario Cordero, report a 35% drop in cargo arrivals compared to last year, with 17 sailings canceled for May. The disruption is comparable to early COVID-19 pandemic levels, with no clear recovery timeline as the peak shipping season approaches.

05/05 13:30

Wall Street to Open Lower Amid S&P 500 Streak, Fed Meeting, Disney Earnings, and Trump's Film Tariffs

Wall Street is expected to open lower on Monday, May 5, after the S&P 500's nine-day winning streak, the longest since 2004. The index's rise was driven by strong corporate earnings and a positive April jobs report. However, investor focus has shifted to renewed trade tensions, a Federal Reserve meeting, Disney's earnings, and Warren Buffett's leadership transition at Berkshire Hathaway. Additionally, former President Donald Trump announced a 100% tariff on foreign films, impacting media stocks. The Federal Reserve is anticipated to maintain interest rates, with investors watching for future economic guidance.

05/03 19:01

U.S. Ends De Minimis Exemption for China: Tariffs Up to 145% Impact Shein, Temu, and Other Ecommerce Platforms

On April 25, 2025, the U.S. ended the de minimis exemption for low-value imports from China and Hong Kong, impacting ecommerce platforms like Shein and Temu. The change, enacted by an executive order from President Donald Trump, imposes tariffs up to 145% on packages under $800, previously duty-free. This policy shift aims to curb illicit imports and protect domestic businesses, affecting cross-border ecommerce, logistics, and consumer prices. Temu halted U.S. deliveries from China, while Shein adjusted pricing to include tariffs, reflecting significant industry adjustments.

05/03 18:31

Warren Buffett Criticizes Trump Tariffs, Endorses Greg Abel as Successor at Berkshire Hathaway Meeting; S&P 500 Recovers

At Berkshire Hathaway’s annual meeting in Omaha, Warren Buffett criticized the Trump administration's tariff policies, warning they risk global economic stability. He also named Greg Abel as his successor, marking a leadership transition. The S&P 500 has rebounded from April losses due to Trump's tariffs, achieving its longest winning streak in two decades. Buffett emphasized that tariffs act as a consumer tax and should not be used as a geopolitical weapon. Abel, head of Berkshire's non-insurance operations, is seen as ready to lead the conglomerate.

05/03 08:31

U.S. Imposes 25% Tariff on Car Parts, GM and Ford See Sales Surge Amid Cost Concerns

A 25% tariff on imported car parts took effect on May 3, 2025, as part of former President Trump's trade agenda, targeting components like engines and transmissions. The policy aims to boost domestic manufacturing and reduce foreign dependency. Despite increased costs, General Motors and Ford reported significant sales increases in April, driven by consumer purchases ahead of expected price hikes. The tariffs, exempting USMCA-compliant parts, could raise automaker costs by $108 billion in 2025. GM and Ford are adjusting production strategies, but analysts warn of market instability affecting long-term investments.

05/02 21:30

Nike, Adidas, and 74 Footwear Companies Urge Trump to Drop Tariffs, Citing 'Existential Threat' to Industry

A coalition of 76 footwear companies, including Nike, Adidas, and Under Armour, urged President Trump to exempt shoes from new tariffs. Coordinated by the Footwear Distributors and Retailers of America, the letter warns that tariffs threaten the U.S. footwear industry, risking job losses, business closures, and price hikes. The tariffs, affecting imports from China, Vietnam, and Cambodia, could lead to shortages and financial strain, as companies struggle with increased costs. The industry calls for targeted trade policies, noting that tariffs won't boost U.S. manufacturing due to the industry's unique supply chain dynamics.

S&P 500 Logs Longest Win Streak Since 2004

The S&P 500 surged nearly 1.5% on Friday, capping a nine-day rally that marked its longest winning streak since November 2004. The index has now fully recovered from the losses triggered by Trump’s April 2 announcement of broad retaliatory tariffs on imports from multiple countries. The rally was fueled by a combination of strong corporate earnings—over 160 S&P 500 companies reported last week, including Apple and Amazon—and renewed hopes for trade negotiations, particularly with China.

Friday’s gains were further supported by a better-than-expected April jobs report. The U.S. economy added 177,000 nonfarm payrolls, surpassing economists’ expectations of 133,000. The data helped ease concerns about a potential economic slowdown and reinforced investor confidence heading into a week filled with critical economic and corporate updates.

Wall Street Braces for Lower Open

Despite the recent rally, U.S. stock futures pointed to a lower open on Monday. June S&P 500 E-mini futures were down 0.75%, while Nasdaq 100 E-mini futures fell 1.02%. The pullback reflects investor caution ahead of the Federal Reserve’s two-day policy meeting and growing uncertainty surrounding U.S. trade policy.

Pre-market trading saw notable declines in major tech and media names. Microsoft dropped over 1% following a downgrade by Phillip Securities, while Shopify fell more than 2% after a downgrade by BNP Paribas Exane. Netflix and Disney also traded lower—down 3% and over 1%, respectively—after Trump’s announcement of new tariffs on foreign films.

Federal Reserve Meeting in Focus

The Federal Open Market Committee (FOMC) begins its two-day meeting on Tuesday, with a policy decision expected Wednesday. The Fed is widely anticipated to keep interest rates unchanged, despite political pressure from the White House to cut rates. Fed Chair Jerome Powell has signaled a “wait and see” approach, citing inflation concerns and the uncertain economic impact of tariffs.

Fed Governor Chris Waller recently stated that a rate move is unlikely at the May or June meetings, noting that the 90-day pause on reciprocal tariffs means the real economic effects may not be visible until after July. Investors will closely watch Powell’s post-meeting remarks for any hints about the Fed’s outlook for the second half of the year.

Disney Earnings on Deck

Walt Disney Co. is scheduled to report its fiscal second-quarter earnings on Wednesday, May 7, before the market opens. Analysts expect earnings per share (EPS) of $1.20, nearly flat compared to $1.21 in the same quarter last year. Revenue is projected at $23.09 billion, down from $24.7 billion in the previous quarter.

Investors will be watching how Disney navigates slowing theme park attendance, underwhelming box office performance, and broader economic headwinds. The company’s cost-cutting initiatives and content pipeline will also be under scrutiny, especially in light of the new 100% tariffs on foreign films, which could impact Disney’s international production strategy.

Trump Imposes 100% Tariffs on Foreign Films

Former President Donald Trump has announced a 100% tariff on all films produced outside the United States, citing a need to revive the domestic film industry. The policy, which he described as a response to a “national security threat,” is being implemented through the Department of Commerce and the U.S. Trade Representative.

The announcement has raised numerous questions about implementation. It remains unclear whether the tariffs will apply to American studios filming abroad, how streaming content will be treated, or how a “foreign” film will be defined. Trump’s statement did not clarify whether the tariffs would be based on filming location, production funding, or creative personnel.

Commerce Secretary Howard Lutnick confirmed the administration is moving forward with the plan, though industry leaders and international partners have expressed concern. Australia’s Home Affairs Minister Tony Burke and New Zealand Prime Minister Christopher Luxon both indicated they are awaiting further details. The Motion Picture Association has not yet issued a formal response.

Warren Buffett to Step Down as Berkshire Hathaway CEO

In a major leadership transition, Warren Buffett announced he will step down as CEO of Berkshire Hathaway at the end of 2025. The 94-year-old investing legend will remain chairman of the board, while Greg Abel, vice chairman of non-insurance operations, will assume the CEO role.

Buffett made the announcement during Berkshire’s annual shareholder meeting, where he also revealed he would retain his entire stake in the company—worth over $160 billion—citing confidence in Abel’s leadership. “The decision to keep every share is an economic decision because I think the prospects of Berkshire will be better under Greg’s management than mine,” Buffett said.

The announcement came as Berkshire reported a 14% drop in operating earnings for the first quarter, driven by a 48.6% decline in insurance underwriting profits, largely due to California wildfires. Buffett also criticized the use of tariffs as economic weapons, stating, “Trade should not be a weapon,” though he did not mention Trump by name.

April Jobs Report Eases Recession Fears

The U.S. labor market showed resilience in April, with nonfarm payrolls rising by 177,000, well above the consensus estimate of 133,000. The report helped calm fears of a sharp economic slowdown and supported the Fed’s cautious stance on interest rates.

The strong jobs data, combined with signs of potential trade negotiations, contributed to last week’s market rally. However, with new tariffs and geopolitical uncertainty back in the spotlight, investors are bracing for increased volatility in the days ahead.

References

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