MARKET WRAPS

Watch For:

Manufacturing PMI data for EU, Germany, France, Italy; EU flash estimate euro area inflation, unemployment; trading updates from Shell, BASF, Standard Chartered, NatWest Group, ING Groep, Pearson, Danske Bank

Opening Call:

European stock futures were higher on a broadly positive lead from Asian equities and gains in U.S stock futures. U.S. Treasury yields edged higher; the dollar weakened; oil futures and gold advanced.

Equities:

European stock futures gained early Friday as investors track developments in trade talks. China said Friday that it was weighing starting talks with the U.S. to halt a trade war, but only if Washington shows sincerity through concrete measures, such as by canceling tariffs against Beijing.

U.S. stocks gained on Thursday, propelled by better-than-expected quarterly results from Microsoft and Meta Platforms, reassuring investors of the relative resilience of the Magnificent Seven tech giants to tariff uncertainty.

Stock prices have turned higher, but they still fail to reflect "the deep damage that the tariffs have already inflicted on global trade," Trade Nation analyst David Morrison said. Traders are focusing on expectations that President Trump will "reach some sort of accommodation over tariffs" while the Fed would cut interest rates "at the first signs of economic pain," Morrison said.

Investors will get the first 'hard' data since Trump's April 2 tariff announcements, when the Labor Department releases April employment data later Friday. A weak jobs number could vindicate Trump's critics; a strong number would shut them up, at least for now.

Forex:

The U.S. dollar weakened early Friday amid risk-on sentiment. The dollar is unlikely to fully reverse its recent losses even if the Trump administration walks back on all its tariffs, said Macquarie strategist Thierry Wizman.

"After all, any capital flight from the U.S. isn't just about foreign central banks, sovereign wealth funds, or public pension plans abroad selling their U.S. assets at the direction of foreign politicians," he said. It's also about the need to diversify away from the dollar, given the reduction in the integrity of some U.S. institutions and systems. The dollar will become less an essential currency and more an alternative among a few comparable choices, such as the euro.

Bonds:

U.S. Treasurys kicked off May with a modest decline, sending yields higher Thursday. Yields initially declined, but a stronger-than-expected survey of U.S. purchasing managers sent yields higher, even though the poll's result still darkened from last month's. The weighty April jobs report, due later today, will set the tone for trading into the weekend.

Energy:

Oil gained but may be weighed by supply concerns ahead of the OPEC+ meeting on Monday. The group may decide to increase production further, Citi Research's Anthony Yuen said.

There could be several reasons for such a decision, including some members of OPEC+ not wanting to restrict their production anymore. If the group opts to raise production further, Brent prices might revisit lows in the $50s/bbl or beyond, Yuen added.

Metals:

Gold advanced early Friday. Despite the recent selloff, gold's fundamentals remain solid, TD Securities' Bart Melek said. "It's likely too late to make tariff deals which would prevent an economic slowdown and higher inflation, implying the Fed may well cut rates in a de facto stagflationary environment," the head of Commodity Strategy said.

"At the same time, many relationships between the U.S. and key trading and strategic partners have been broken, suggesting a slow pivot away from USD and Treasurys will continue to happen." This implies market participants should again tilt toward the precious metal, Melek added.

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Copper gained. There are signs of progress on trade deals between the U.S. and other nations, ANZ Research analysts said. Copper prices are also supported by supply-side issues, as two of Peru's biggest copper mines were disrupted by community protests this week, ANZ added.

TODAY'S TOP HEADLINES

China Signals Readiness to Respond to U.S. Trade Overtures

China said Friday it was weighing starting talks with the U.S. to halt a trade war, but only if Washington shows sincerity through concrete measures such as by canceling tariffs against Beijing.

A Chinese Commerce Ministry spokesperson said "China is currently evaluating" repeated comments and messages from U.S. officials that "expressed their willingness to negotiate with China on tariffs."

Trump to Propose Slashing $163 Billion in Government Programs in Budget Blueprint

WASHINGTON-President Trump is expected to propose far-reaching cuts to federal environmental, renewable energy, education and foreign-aid programs in a budget blueprint that slashes nondefense discretionary spending by more than $160 billion, according to administration officials.

The fiscal 2026 budget proposal, which the White House is planning to release on Friday, is a largely symbolic wish list that lays out the president's spending and political priorities. Congress, which Republicans control by narrow majorities in both chambers, will spend months debating which elements of the proposed plan should be turned into law.

Why the AI Trade May Not Save the Market From Trump's Tariffs for Long

Wall Street was in need of something to send the stock market higher as it recovers from its tariff-induced plunge. Now, there are hopes that the Magnificent Seven may be coming to the rescue.

Stocks rose Thursday in response to strong earnings from Microsoft and Meta Platforms, the owner of Facebook. Adding to the gains was that while many companies are suspending their financial guidance because of uncertainty about the effects of President Donald Trump's trade war, both Microsoft and Meta issued upbeat forecasts for the second quarter.

Equinor Sells Stake in Brazil's Peregrino Oil Field for $3.5 Billion

Norwegian energy major Equinor is selling a 60% stake in a Brazilian oil field for about $3.50 billion, part of its effort to "high-grade" its international portfolio.

Equinor's Brazilian subsidiary has signed an agreement to sell its interest in the Peregrino field to Prio Tigris, a unit of PRIO SA, Brazil's largest independent oil-and-gas firm, the company said Friday.

Europe Is Racing to Build Its Own Version of the U.S. Military-Industrial Complex

America's vast military-industrial complex has many critics. For Europe, it is now something to aspire to.

This week, Germany asked the European Union to invoke an emergency clause exempting defense investment from spending rules, as part of the bloc's five-year rearmament plan. Global defense expenditure experienced the highest year-over-year rise since at least the end of the Cold War in 2024, Stockholm International Peace Research Institute data showed this week, with Europe as the main contributor. Analysts estimate NATO members could add EUR700 billion ($798 billion) to EUR2 trillion in extra military spending by 2030.

U.S., Ukraine Minerals Deal Seeks to Smooth Relations and Aid

The minerals deal signed by Ukraine and the U.S. is expected to boost relations between the two allies as they plan joint investments in critical resources.

Senior Treasury officials declined Thursday to say how long it could take for U.S. companies to mine the rare earth minerals that President Trump has touted as a centerpiece of the deal. Some of those minerals are near the front lines in Ukraine, which is fighting to repel Russia. The officials said oil and gas projects in Ukraine were likely the first to come to fruition because they would be easier to execute.

Apple Says Most of Its Devices Shipped Into U.S. Will Be From India, Vietnam

Apple said a majority of its devices shipped into the U.S. in the June quarter will originate in India and Vietnam, a move to allay investor concerns about the impact of tariffs on its operations.

The company was among the hardest-hit of the tech giants last month because of its exposure to China, a primary target of the Trump administration's global tariff pressure. Most of Apple's devices are assembled in the country, and investors are closely watching its efforts to shift final assembly of devices bound for the U.S. to India and other countries.

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Expected Major Events for Friday

04:30/NED: Apr Flash Estimate CPI

05:00/NED: Apr Netherlands Manufacturing PMI

06:00/POL: Apr Poland Manufacturing PMI

07:00/TUR: Apr Turkey Manufacturing PMI

07:15/SPN: Apr Spain Manufacturing PMI

07:30/CZE: Apr Czech Republic Manufacturing PMI

07:30/SWI: Apr procure.ch Purchasing Managers' Index

07:45/ITA: Apr Italy Manufacturing PMI

07:50/FRA: Apr France Manufacturing PMI

07:55/GER: Apr Germany Manufacturing PMI

08:00/GRE: Apr Greece Manufacturing PMI

08:00/EU: Apr Eurozone Manufacturing PMI

08:00/ITA: Mar Unemployment

08:00/ICE: Mar Labour Force Survey

09:00/ITA: Mar Foreign Trade non-EU

09:00/POR: 1Q Flash Estimate GDP

09:00/EU: Apr Flash Estimate euro area inflation

09:00/CYP: Mar Retail trade

09:00/EU: Mar Unemployment

10:00/POR: Mar Retail trade

10:00/POR: Mar Industrial production index

10:00/IRL: Apr Irish Live Register latest monthly figures

15:00/DEN: Apr Foreign Exchange & Liquidity

16:59/AUT: Apr Unemployment figures

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May 02, 2025 00:00 ET (04:00 GMT)

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