U.S. Stock Market Outlook | Three Major Index Futures Rise, WTI Crude Oil Drops Over 3%

Pre-Market Market Trends

1. As of May 5th (Tuesday), U.S. stock index futures are all up before the market opens. As of the time of writing, Dow futures are up 0.48%, S&P 500 futures are up 0.52%, and Nasdaq futures are up 0.80%.

1. As of the time of writing, the German DAX index is up 1.13%, the UK FTSE 100 index is down 1.62%, the French CAC40 index is up 0.81%, and the Euro Stoxx 50 index is up 1.28%.

1. As of the time of writing, WTI crude oil is down 3.05%, priced at $103.17 per barrel. Brent crude oil is down 2.07%, priced at $112.07 per barrel.

Market News

Goldman Sachs warns: Global oil inventories are nearing an eight-year low, and the consumption rate is concerning. With ongoing conflicts in the Middle East and the Strait of Hormuz still blocked, the consumption rate of global crude oil and refined oil inventories is accelerating. Goldman Sachs' latest report indicates that global oil inventories have fallen to near the lowest level in eight years, warning that the speed of inventory consumption is becoming a worrying issue. Goldman Sachs analysts estimate that current global crude oil inventories are equivalent to 101 days of global demand, and are expected to further drop to 98 days by the end of May. Although overall global oil inventories are unlikely to fall below the minimum operational warning line this summer, the speed of destocking in certain regions and oil products, as well as supply disruptions, have drawn market attention.

Oak Tree Capital Co-CEO: Market pricing is perplexing, and fundamental risks are severely underestimated. Armen Panossian, Co-CEO of Oaktree Capital Management, warned that the market is digesting a series of fundamental issues too quickly, prompting his firm to choose to hold cash and wait for the right moment to adjust. Panossian pointed out that the "extremely abundant" liquidity post-pandemic, the market's willingness to maintain positions, and strong historical corporate performance have collectively driven investors to selectively ignore potential economic data. He stated that the market generally believes that U.S. President Trump will not take any actions that fundamentally undermine the economy, and this belief has further reinforced market resilience. Panossian remarked, "When you overlay the impact of the Iran war and then add in the software industry pains we expect to manifest over the next few years, it becomes somewhat perplexing why the market is so strong." "He warned that investors are underestimating the fundamental risks facing the credit market.

JP Morgan: The market is likely to see a broad rally as long as there are positive developments. JP Morgan strategists stated that the rebound in global stock markets since the low point of the Iran conflict has been very narrow, and the market is already positioned such that any positive news could lead to a broad rally. The team led by Mislav Matejka noted that the market may remain volatile in the short term, but investors with a longer investment horizon should continue to take advantage of stock market pullbacks to increase their positions. The strategists pointed out that the V-shaped rebound of the MSCI Global Index seems disconnected from the surge in oil prices, but in reality, this round of increase has been driven by a very small number of stocks. Currently, investor positions are lower than before the outbreak of the conflict, and as various factors suppressing buying gradually ease, the market's upward trend is expected to further spread.

The EU responds again to Trump's auto tariff threats: Prepared for all scenarios. On May 5 local time, European Commission President Ursula von der Leyen responded to U.S. President Trump's recent threat of auto tariffs, stating that the U.S. cannot unilaterally raise tariffs and that the EU is prepared for "all scenarios." Trump stated on social media on May 1 that the U.S. would raise the import tariffs on EU cars due to the EU's failure to comply with the bilateral trade agreement with the U.S. He said that the tariffs on EU cars exported to the U.S. would increase to 25%. If these cars are produced in the U.S., there will be no tariffs. In response, an EU Commission spokesperson stated that the EU would "reserve all options" and assess possible countermeasures. The spokesperson also indicated that the EU is implementing the relevant trade agreements according to normal legislative procedures and is continuously updating the U.S. on progress.

Individual Stock News

Eaton (ETN.US) Q1 performance is impressive but falls pre-market: Annual profit guidance slightly below expectations, 40 times P/E ratio under pressure. Eaton's net profit for the first quarter was $866 million, or $2.22 per share. Adjusted for amortization costs and acquisition-related costs, earnings per share were $2.81, exceeding Wall Street's expectation of $2.74. Revenue was $7.45 billion, a 17% year-over-year increase, also surpassing Wall Street's expectation of $7.09 billion. Organic sales grew by 10%, higher than the company's previous expectation range of 5%-7%. Looking ahead, although Eaton raised its full-year organic growth expectation from the previous 8%-10% to 9%-11%, reflecting strong demand across its markets, it expects second-quarter earnings per share to be between $3.00 and $3.10, with the midpoint of $3.05 slightly below market expectations. The company also expects full-year earnings per share to be between $13.05 and $13.50, below expectations, with the midpoint of $13.28 lower than the consensus estimate of $13.30. The stock fell 4.2% in pre-market trading.

Pfizer (PFE.US) Q1 performance exceeds expectations, reaffirms full-year guidance. Pfizer's first-quarter revenue was $14.45 billion, better than expected; adjusted earnings per share for the first quarter were $0.75, also better than expected. Pfizer reaffirmed its full-year guidance, still expecting adjusted earnings per share of $2.80 to $3.00, with market estimates at $2.96; Pfizer still expects full-year revenue of $59.5 billion to $62.5 billion, with market estimates at $61.37 billion The stock rose 2% in pre-market trading.

GlobalFoundries (GFS.US) Q1 earnings exceeded expectations. Data shows that the company's Q1 revenue was $1.63 billion, in line with expectations; earnings per share were $0.40, exceeding expectations. GlobalFoundries expects adjusted earnings per share for the second quarter to be between $0.38 and $0.48, with market estimates at $0.40; the company anticipates second-quarter revenue to be between $1.735 billion and $1.785 billion, with market estimates at $1.743 billion. The stock rose over 5% in pre-market trading.

Skeptical of eBay acquisition, "big short" Michael Burry quickly liquidates GameStop (GME.US). Michael Burry, the legendary investor and prototype of "The Big Short," sold all his shares of GameStop (GME.US) after the company proposed to acquire the e-commerce platform eBay (EBAY.US) for about $56 billion in cash and stock. Burry had been optimistic about GameStop around 2019, which drove the company's stock price up. However, the investor told subscribers in his Substack newsletter on Monday that he has exited, citing concerns that GameStop may incur massive debt due to the acquisition. Burry stated, "I sold all my GameStop shares. From any angle, the investment philosophy of 'fast-track Berkshire' does not match reality." The investor also mentioned on Monday that he has nearly doubled his position in Lululemon Athletica (LULU.US).

Alphabet (GOOGL.US) returns to the Euro debt market: reportedly plans to raise €3 billion, expanding global financing landscape under $100 billion AI spending. According to insiders, Alphabet has launched a six-part debt sale plan denominated in euros, issuing at least €3 billion (approximately $3.5 billion) in bonds, with maturities ranging from 4 to 37 years. Barclays, BNP Paribas, Deutsche Bank, and HSBC Holdings are acting as arrangers for this issuance. This news comes just months after Alphabet's first euro bond issuance of €6.75 billion, making a record entry into this market; just days earlier, on April 29, Alphabet had raised its full-year capital expenditure guidance for 2026 to $180 billion to $190 billion, setting a new record for the company and surpassing the most aggressive expectations of Wall Street analysts.

Apple (AAPL.US) is considering collaborating with Intel (INTC.US) and Samsung to produce its main device chips. Reports indicate that Apple is in preliminary discussions to commission Intel and Samsung to produce its main device chips. Additionally, Apple's executives have visited a state-of-the-art chip factory that Samsung is building in Texas. Insiders revealed to the media that negotiations are currently at a very early stage, and no orders have been placed yet. Apple has concerns about using non-TSMC technology and may ultimately not collaborate with other partners.

OpenAI co-founder reveals nearly $30 billion in holdings, with deep financial ties to Sam Altman. Greg Brockman, co-founder and president of OpenAI, disclosed in court on Monday that his financial ties with CEO Sam Altman are closer than previously known At the same time, the value of his shares in this ChatGPT developer is close to $30 billion. These details were disclosed during questioning by Elon Musk's lawyer. Musk is one of the co-founders of OpenAI and is currently suing the company, accusing it of improperly transitioning to a for-profit entity, abandoning its charitable goals, and should be restored as a non-profit organization. Musk's team believes that Brockman's independence may be compromised by financial incentives that make him inclined to support Altman's push for OpenAI's transformation into a for-profit company. Brockman also revealed in court that he holds shares in two startups backed by Altman and has a certain percentage in Altman's family fund. Musk is seeking to oust Altman and Brockman from the company's management and is claiming $150 billion in damages.

Net profit surged nearly fourfold, full-year guidance raised again! Palantir (PLTR.US) Q1 U.S. business "exploded" but commercial sales left regrets. Palantir delivered a report for the first quarter of 2025 that far exceeded Wall Street expectations. Revenue reached $1.63 billion, surpassing the market average expectation of $1.54 billion, with a year-on-year increase of 85%; adjusted earnings per share were $0.33, 18% higher than the market expectation of $0.28; net profit skyrocketed from $214 million in the same period last year to $870.5 million, an increase of nearly four times. Full-year guidance has been significantly raised. Meanwhile, U.S. commercial sales revenue slightly fell short of expectations, becoming the "shadow" in this financial report. The stock fell nearly 3% in pre-market trading.

ON Semiconductor (ON.US) Q1 performance exceeded expectations, data center revenue surged 30% quarter-on-quarter. Analog chip manufacturer ON Semiconductor reported a 5% year-on-year revenue growth to $1.51 billion in the first quarter, exceeding the market expectation of $1.49 billion; adjusted earnings per share were $0.64, higher than the market consensus expectation of $0.62. According to GAAP, the loss per share was $0.08, compared to a loss of $1.15 per share in the same period of 2025. The company's revenue growth mainly came from the power solutions segment, which saw a 14% year-on-year increase to $736.6 million. The analog and mixed-signal segment declined by 4.6%, while the smart sensing segment slightly increased by 0.9%. ON Semiconductor CEO Hassane El-Khoury stated, "Our AI data center business is accelerating growth, with a quarter-on-quarter increase of over 30%. Looking ahead, we are encouraged by the fundamental health of the business and the long-term opportunities brought by the increasing semiconductor content in automotive, industrial, and AI data center applications." The stock fell 4.6% in pre-market trading.

Important Economic Data and Event Forecasts

Beijing time 22:00 U.S. April ISM Non-Manufacturing PMI, U.S. March seasonally adjusted new home sales annual total, U.S. March JOLTs job openings

Earnings Forecast

Wednesday morning: AMD (AMD.US), Arista Networks (ANET.US), Lumentum (LITE.US), Occidental Petroleum (OXY.US) Pre-market on Wednesday: Novo Nordisk (NVO.US), Disney (DIS.US), Uber (UBER.US)