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Yahoo
28-05-2025
- Business
- Yahoo
With Trump tariff jitters, S&P 500 to finish year nearly even with 2024: Reuters poll
By Caroline Valetkevitch NEW YORK (Reuters) - The S&P 500 will finish the year near current levels, according to a Reuters poll, after many strategists in recent months cut their 2025 forecast for the index over uncertainty surrounding U.S. President Donald Trump's tariffs. Based on the median forecast of 51 equity strategists, analysts, brokers and portfolio managers collected May 15-28, the year-end target for the benchmark S&P 500 is 5,900, down from 6,500 in a February poll by Reuters. The S&P 500 ended Tuesday at 5,921.54. The market will remain choppy, strategists said, while seven out of 14 respondents who answered a question on profit growth said S&P 500 earnings will be marginally higher in 2025 than in 2024 and two said significantly higher. Five said they would be marginally lower. Sameer Samana, head of global equities and real assets at Wells Fargo Investment Institute, said the firm lowered its year-end target to 6,000 recently from 6,500 set at the start of the year. "Clearly earnings will be impacted by what's going on with tariffs," he said. "Our belief is tariffs are a tax and some combination of U.S. consumers, U.S. companies along with international producers and companies will pay the taxes. In essence, that kind of wealth transfer comes out of earnings to a certain extent," he added. According to LSEG, S&P 500 earnings are expected to increase 8.4% in 2025 compared with 12.1% in 2024. But the 2025 estimate is down sharply from 14% growth estimated on January 1. Trade developments have whipsawed the stock market this year, especially after Trump's April 2 announcement of sweeping tariffs on imports globally. In his latest move, Trump on Sunday backed down from his threat of a 50% tariff against the European Union, delaying its implementation until July 9 to allow for negotiations between the White House and the 27-nation bloc. The move prompted Brussels to fast track preparations for trade talks. Following a Tuesday rally, the S&P 500 is up just 0.7% for the year. But strategists say the back-and-forth nature of tariff negotiations has made predicting what the index will do tough. "It's very difficult to forecast given the tariff uncertainty and the changing dynamics that seem to happen daily," said Anthony Saglimbene, chief market strategist at Ameriprise Financial in Troy, Michigan. "There's just a higher risk premium that has to be put on stocks, and that's going to be with us through the rest of this year." He said his firm's "base" target is 5,600 for the S&P 500 for this year, but a "6,000 to 5,600 range seems very reasonable based on the tariff environment not really causing a recession or deteriorating corporate profits too much." Some strategists have raised their S&P 500 forecasts recently. Last week, David Lefkowitz, head of U.S. equities at UBS Global Wealth Management, wrote that the firm was increasing its year-end target to 6,000 from 5,800 partly because of a "solid first-quarter earnings season". Concerns over the U.S. debt load have added to recent jitters and a "sell America" view by some investors. Moody's downgraded its U.S. credit rating on May 16, and the Republican-controlled U.S. House of Representatives passed Trump's sweeping tax-cut bill last week. The bill goes to the U.S. Senate next for review where investors worry spending cuts could be whittled down, growing the deficit. The S&P 500 posted gains exceeding 20% in both 2024 and 2023, helped by megacap technology stocks and optimism over the business potential of artificial intelligence. While the S&P 500 technology sector remains down 1.7% so far for 2025, it has been bouncing back, and some investors still see it as a good bet going forward. "Technology will likely remain volatile, but any downturns we get in tech, investors should use that as a long-term buying opportunity," Saglimbene said, noting tech profit growth should hold up. Samana said Wells Fargo Investment Institute likes energy, financials and communication services and noted the firm "took the opportunity in the middle of the pullback to upgrade tech." He is cautioning investors against consumer staples and utilities. At the same time, Eric Teal, chief investment officer for Comerica Wealth Management, expects the Dow to end the year at 48,000 and to outperform the S&P 500 this year "due to more industrial and attractively valued companies and less-concentrated technology exposure." The poll has the Dow Jones Industrial Average finishing this year at 43,708, down from 47,024 in the Reuters February poll. The index closed at 42,343.65 on Tuesday. (Other stories from the Reuters Q2 global stock markets poll package) Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
28-05-2025
- Business
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With Trump tariff jitters, S&P 500 to finish year nearly even with 2024: Reuters poll
By Caroline Valetkevitch NEW YORK (Reuters) - The S&P 500 will finish the year near current levels, according to a Reuters poll, after many strategists in recent months cut their 2025 forecast for the index over uncertainty surrounding U.S. President Donald Trump's tariffs. Based on the median forecast of 51 equity strategists, analysts, brokers and portfolio managers collected May 15-28, the year-end target for the benchmark S&P 500 is 5,900, down from 6,500 in a February poll by Reuters. The S&P 500 ended Tuesday at 5,921.54. The market will remain choppy, strategists said, while seven out of 14 respondents who answered a question on profit growth said S&P 500 earnings will be marginally higher in 2025 than in 2024 and two said significantly higher. Five said they would be marginally lower. Sameer Samana, head of global equities and real assets at Wells Fargo Investment Institute, said the firm lowered its year-end target to 6,000 recently from 6,500 set at the start of the year. "Clearly earnings will be impacted by what's going on with tariffs," he said. "Our belief is tariffs are a tax and some combination of U.S. consumers, U.S. companies along with international producers and companies will pay the taxes. In essence, that kind of wealth transfer comes out of earnings to a certain extent," he added. According to LSEG, S&P 500 earnings are expected to increase 8.4% in 2025 compared with 12.1% in 2024. But the 2025 estimate is down sharply from 14% growth estimated on January 1. Trade developments have whipsawed the stock market this year, especially after Trump's April 2 announcement of sweeping tariffs on imports globally. In his latest move, Trump on Sunday backed down from his threat of a 50% tariff against the European Union, delaying its implementation until July 9 to allow for negotiations between the White House and the 27-nation bloc. The move prompted Brussels to fast track preparations for trade talks. Following a Tuesday rally, the S&P 500 is up just 0.7% for the year. But strategists say the back-and-forth nature of tariff negotiations has made predicting what the index will do tough. "It's very difficult to forecast given the tariff uncertainty and the changing dynamics that seem to happen daily," said Anthony Saglimbene, chief market strategist at Ameriprise Financial in Troy, Michigan. "There's just a higher risk premium that has to be put on stocks, and that's going to be with us through the rest of this year." He said his firm's "base" target is 5,600 for the S&P 500 for this year, but a "6,000 to 5,600 range seems very reasonable based on the tariff environment not really causing a recession or deteriorating corporate profits too much." Some strategists have raised their S&P 500 forecasts recently. Last week, David Lefkowitz, head of U.S. equities at UBS Global Wealth Management, wrote that the firm was increasing its year-end target to 6,000 from 5,800 partly because of a "solid first-quarter earnings season". Concerns over the U.S. debt load have added to recent jitters and a "sell America" view by some investors. Moody's downgraded its U.S. credit rating on May 16, and the Republican-controlled U.S. House of Representatives passed Trump's sweeping tax-cut bill last week. The bill goes to the U.S. Senate next for review where investors worry spending cuts could be whittled down, growing the deficit. The S&P 500 posted gains exceeding 20% in both 2024 and 2023, helped by megacap technology stocks and optimism over the business potential of artificial intelligence. While the S&P 500 technology sector remains down 1.7% so far for 2025, it has been bouncing back, and some investors still see it as a good bet going forward. "Technology will likely remain volatile, but any downturns we get in tech, investors should use that as a long-term buying opportunity," Saglimbene said, noting tech profit growth should hold up. Samana said Wells Fargo Investment Institute likes energy, financials and communication services and noted the firm "took the opportunity in the middle of the pullback to upgrade tech." He is cautioning investors against consumer staples and utilities. At the same time, Eric Teal, chief investment officer for Comerica Wealth Management, expects the Dow to end the year at 48,000 and to outperform the S&P 500 this year "due to more industrial and attractively valued companies and less-concentrated technology exposure." The poll has the Dow Jones Industrial Average finishing this year at 43,708, down from 47,024 in the Reuters February poll. The index closed at 42,343.65 on Tuesday. (Other stories from the Reuters Q2 global stock markets poll package)
Yahoo
24-03-2025
- Business
- Yahoo
First-quarter US earnings outlook looks less rosy with tariff worries in focus
By Caroline Valetkevitch NEW YORK (Reuters) - Analysts are turning more cautious on U.S. corporate earnings for the first quarter of this year, with the Trump administration's policies threatening to trigger a global trade war that could undermine economic growth. Apple, Tesla and Ford Motor are among companies contributing the most to recently lowered estimates for the quarter, along with some insurers, whose projections have been hurt by fires in California early this year, according to Tajinder Dhillon, senior research analyst at LSEG. S&P 500 forecasts for the first quarter of 2025 have fallen by 4.5 percentage points since January 1, the largest downward revision since the fourth quarter of 2023, he said. Earnings growth for S&P 500 companies is now seen at 7.7% year-over-year, which would be the lowest since 2023's third quarter and a big decline from 17.1% in the fourth quarter of 2024, based on Friday's LSEG data. While a handful of companies have already reported on the quarter, the unofficial start of the first-quarter season is still weeks away. "You know there's this negative bias out there. You just don't know to what degree," said Michael O'Rourke, chief market strategist at JonesTrading in Stamford, Connecticut. Earnings estimates typically decline in the weeks ahead of a new reporting period as companies guide more conservatively, but the majority of companies often go on to beat those lowered expectations. Fears that import tariffs and retaliation by U.S. trade partners, along with government cutbacks under President Donald Trump in the first months of his second term, might push the economy into recession have increased in recent weeks. On March 13, the S&P 500 confirmed it is in a correction by ending down more than 10% from its February 19 record high close. "A lot of people are worried about things like tariffs ... Really, it's a broad economic slowdown that is the one thing that would be very difficult for companies to contend with," said Sameer Samana, senior global market strategist at Wells Fargo Investment Institute. Some investors have hoped that first-quarter earnings could provide a catalyst for gains in the market after the sharp selloff. The S&P 500 is still trading at a multiple of 21 times forward earnings, compared with a 10-year average price-to-earnings ratio of about 18, based on LSEG data. Apple on January 30 reported earnings for the quarter ended December 28 that beat analysts' expectations, but iPhone sales and China revenue for the holiday quarter were weak because of competition in China and a slow rollout of artificial intelligence features. On Thursday, the Information reported, citing sources, that Apple is losing more than $1 billion a year on its streaming service Apple TV+. Tesla sales fell in Scandinavia and France in February from a year ago, according to registration data, as the company faced a brand loyalty test amid CEO Elon Musk's role in the Trump administration's push to cut federal spending. Even after a nearly 40% drop in Tesla shares since the start of the year, the stock is trading at more than 80 times forward earnings expectations. Tesla's earnings per share estimate for the March quarter is down to 47 cents from 70 cents in late January, based on LSEG data. Ford in February projected up to $5.5 billion in losses on its electric vehicle and software operations this year. Automakers have been in focus, with the White House saying earlier this month that Trump will exempt them from his punishing 25% tariffs on Canada and Mexico for one month. Some analysts see the California wildfires in January as among the costliest natural disasters for insurers. Travelers Companies said in February that it sees $1.7 billion of pre-tax catastrophe losses from the wildfires. In the airline industry, shares tumbled recently as Delta Air Lines and others sharply cut earnings forecasts, citing uncertainty about consumer spending.
Yahoo
15-03-2025
- Business
- Yahoo
Quantum computing company shares jump after D-Wave's upbeat forecast
By Caroline Valetkevitch NEW YORK (Reuters) - Shares of some quantum computing companies rallied on Thursday, adding to gains from the previous session and bucking the broader market's trend after D-Wave Quantum forecast stronger-than-expected quarterly revenue. D-Wave Quantum (QBTS) shares were last up 15% at $6.71 after the company forecast Thursday its current-quarter would be above analysts' expectations. The stock ended up about 8% on Wednesday after the company published a peer-reviewed paper in Science that said its quantum computer outperformed one of the world's most powerful classical supercomputers. Drawing on quantum mechanics, quantum computers are faster and more efficient than classical computers partly due to their superior ability to perform operations in parallel, predict the results of multiple paths simultaneously and store vast amounts of data. Shares of Quantum Corp (QMCO) were up 26% and on track for its biggest daily percentage gain since mid-February. The stock was up about 10% on Wednesday. Shares of Quantum Computing Inc (QUBT) were up 2%, while the broader market was sharply lower, with the Nasdaq composite down more than 2% in afternoon trading. "If AI (artificial intelligence) is in its infancy, then quantum is in its embryonic stage... It's the wild west, and it's just going to grow. It's the obsession right now on Wall Street," said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma. Microsoft (MSFT) last month launched a new quantum chip that heated up the debate over the technology. Dollarhide said he invests in the field through the Defiance Quantum exchange-traded fund. It was down 0.8% on Thursday. While some shares in the space were rallying Thursday, IonQ's stock was down 5.3% at $20.68 after Kerrisdale Capital said it has taken short position in the stock. IonQ's stock is down roughly 50% for the year to date after rising more than 200% in 2024. Sign in to access your portfolio
Yahoo
07-03-2025
- Business
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Nasdaq confirms correction, dollar weakens as tariff news fuels unease
By Caroline Valetkevitch NEW YORK (Reuters) -Stock indexes fell sharply and the dollar eased on Thursday, with the Nasdaq confirming it has been in a correction since peaking last December, as more announcements from U.S. President Donald Trump on tariffs fueled investor uncertainty. The global bond market selloff continued, a day after the 10-year German Bund yield saw its biggest rise since the 1990s. Trading was volatile as investors tried to stay on top of tariff headlines. In the latest twist in his fast-changing trade policy, Trump on Thursday exempted goods from both Canada and Mexico under a North American trade pact for a month from the 25% tariffs that he had imposed earlier this week. The 25% U.S. tariffs on imports from Mexico and Canada were imposed on Tuesday along with fresh duties on Chinese goods. "Trump has been very confusing about these tariffs. One day they're on and the next day they're off for a month," said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York. "He did warn us that there was going to be some pain initially here, and the market doesn't like pain," he said. With Thursday's 2.6% decline, the Nasdaq was down a total of 10.4% from its record high close on December 16, meeting a widely used definition of a correction. The Cboe Volatility index rose to 24.87, its highest closing level since December 18. Adding to the negative tone, an index of chipmakers dropped 4.5% after a sales forecast from Marvell Technology failed to excite investors. Marvell shares fell 19.8% on the day. The Dow Jones Industrial Average fell 427.51 points, or 0.99%, to 42,579.08, the S&P 500 fell 104.11 points, or 1.78%, to 5,738.52 and the Nasdaq Composite fell 483.48 points, or 2.61%, to 18,069.26. MSCI's gauge of stocks across the globe fell 8.33 points, or 0.97%, to 850.38. The pan-European STOXX 600 index slipped 0.03%. The U.S. dollar weakened while the safe-haven yen and Swiss franc advanced as jittery investors turned risk-averse and worries mounted over the potential impact of Trump's tariffs on the U.S. economy. In afternoon trading, the dollar was down 0.9% against the yen to 147.65 yen, hitting a five-month low earlier of 147.31. Against the Swiss franc, the dollar dropped to a three-month low of 0.8828 franc, and last traded down 0.9% at 0.8827. The single European currency was last down 0.05% at $1.0785, after earlier hitting a four-month high of $1.0854. The euro was on track for its biggest weekly jump since May 2009. The European Central Bank cut interest rates as expected and also said monetary policy was becoming less restrictive, which traders took to mean another cut in April might not be a given. Ten-year German Bund yields were last up 10 basis points at 2.884%, having jumped as high as 2.929% on Wednesday. German lawmakers are expected to debate a 500-billion-euro infrastructure fund and sweeping changes to state borrowing rules to fund defence from March 13. The yield on benchmark U.S. 10-year notes rose 1.5 basis points to 4.282%, from 4.267% late on Wednesday. Investors also assessed the latest batch of economic data for signs of cracks in the economy ahead of Friday's key monthly U.S. payrolls report. Weekly initial U.S. jobless claims fell by 21,000 to a seasonally adjusted 221,000, according to the Labor Department, a bigger decline than expected by economists polled by Reuters, who had forecast 235,000 claims. By contrast, global outplacement firm Challenger, Gray & Christmas earlier in the day said that planned job cuts vaulted 245% to 172,017 last month, the highest level since July 2020 when the economy was in the midst of the COVID-19 pandemic. Also in focus were comments by European leaders, who said they would stand by Ukraine and spend more on defense in a world upended by Trump's reversal of U.S. policies. Trump's suspension of military aid to Kyiv this week fanned fears the region can no longer rely on U.S. protection in place since World War Two. Oil prices were largely unchanged, with Brent futures rising 16 cents, or 0.2%, to settle at $69.46 a barrel. U.S. West Texas Intermediate crude futures gained 5 cents, or 0.1%, to settle at $66.36. Spot gold fell 0.1% to $2,915.83 an ounce. Sign in to access your portfolio
