U.S. equities came under renewed pressure last week as investors grappled with lingering trade tensions and mixed corporate earnings.

The S&P 500 (SPY) fell 1.41%, while the Nasdaq Composite (QQQ) and Dow Jones Industrial Average (DIA) declined 2.27% and 2.62%, respectively, for the week. The pullback erased some of the gains from the previous week’s rally, which had been driven by a 90-day pause in tariffs.

Markets closed early Thursday ahead of Good Friday, amplifying reactions to Federal Reserve Chair Jerome Powell’s warning that Trump’s tariffs could lead to “more persistent inflation” amid slowing growth. His comments heightened market uncertainty, especially as the U.S.-China standoff showed little sign of resolution. President Trump’s insistence on direct negotiations with Chinese President Xi Jinping has stalled diplomatic progress, leaving the trade conflict unresolved.

Earnings season picked up as well, with Bank of America reporting stronger-than-expected Q1 profits, helping lift financials early in the week. However, sentiment turned midweek as Trump’s administration escalated investigations into semiconductor tariffs, and Chinese airlines halted Boeing deliveries in retaliation for U.S. trade policy.

Tech and healthcare sectors saw notable moves—Netflix shares rose 5% ahead of its earnings report, buoyed by ambitious revenue targets, while Johnson & Johnson dipped after disclosing $400 million in projected 2025 tariff costs, though the company maintained earnings guidance. Ford extended its year-to-date decline, pressured by warnings that 25% auto tariffs could add thousands of dollars per vehicle to production costs.

Looking ahead, investors will continue to monitor upcoming earnings reports and any signs of progress in U.S.-China trade negotiations. Two key factors are likely to drive market direction in the coming weeks.

📅 Wednesday, April 23rd

• Flash Manufacturing PMI: The upcoming April 2025 Flash Manufacturing PMI is forecast at 49.3, indicating continued contraction in the manufacturing sector, though slightly improved from March’s reading of 49.0, as manufacturers continue to face challenges from tariff-related price pressures and weakening demand conditions. Market participants should closely monitor the new orders component (which registered 45.2 in March) and the prices index (which surged to 69.4 in March, the highest since June 2022) to gauge whether manufacturing demand is stabilizing and if inflation pressures are persisting amid ongoing trade tensions.

• Flash Services PMI: The upcoming report is forecasted at 52.9, compared to March’s final reading of 54.4, and will help gauge whether growth is moderating following March’s upwardly revised expansion. Market participants should closely monitor operating costs driven by labor expenses and vendor price hikes, which have surged at the fastest pace in 18 months, along with hiring momentum. Traders will also scrutinize business confidence for signs of impact from tariffs and tightening credit conditions ahead of the Federal Reserve’s May meeting.

📅 Thursday, April 24th

• Unemployment Claims: The upcoming initial unemployment claims report is forecasted of 218,000, which would represent a slight uptick from the previous week’s unexpectedly strong 215,000 reading while remaining below the four-week moving average of 220,750. Market participants should scrutinize whether continuing claims maintain their upward trajectory after last week’s surge to 1,885,000, as this could signal mounting challenges in labor market reabsorption despite strong headline job creation, while monitoring for impacts from federal workforce reductions that may begin appearing in claims data as severance periods expire.

With earnings season ramping up, here are some stocks reporting earnings this week:

📅 Tuesday, April 22nd

• Tesla Inc (TLSA): Tesla will report its Q1 2025 financial results, with analysts projecting disappointing figures, including EPS of $0.43 and revenue of approximately $21.45 billion, representing near-flat year-over-year growth or potentially a decline.
  
  Market participants should watch for Tesla’s explanation for its Q1 vehicle deliveries, which came in at 336,681 units—a 13% year-over-year drop and the weakest quarterly performance in nearly three years. The decline is attributed to factory retooling for the new Model Y and a shrinking share of the EV market, despite overall EV sales rising. Amid these challenges, Tesla’s energy generation and storage business represents a potential bright spot, having deployed 10.4 GWh of energy storage products in Q1 (a substantial 156% year-over-year increase), which could partially offset weakness in the core vehicle business and provide insight into Tesla’s diversification strategy.

📅 Wednesday, April 23rd

• Boeing Co (BA): Boeing will release its earnings report with analysts expecting a quarterly loss of approximately $1.24 per share despite projected revenues of $19.46 billion, representing a 17.4% year-over-year revenue increase.
  
  The company has already announced Q1 deliveries of 130 commercial airplanes (including 105 737s) and 26 defense program units, which will significantly impact the financial outcomes. Investors should closely monitor Boeing’s positive Earnings ESP of +12.72% (suggesting a potential earnings beat), recent 16.33% upward revision in EPS estimates, and management’s commentary on production stability following previous Boeing Co, especially as the company positions itself to capitalize on the aging global commercial aircraft fleet with an average age of 14.8 years.

• Chipotle Mexican Grill (CMG): Chipotle Mexican Grill will report its earnings with analysts projecting $0.28 EPS (up 3.7% YoY) and $2.96 billion in revenue (9.6% YoY growth). Market participants should focus on comparable-store sales performance against management’s low-to-mid-single-digit 2025 guidance, particularly after January’s 2% sales dip. Key risks include tariff-driven cost pressures (60bps margin impact if implemented) and moderating traffic trends, as CMG’s stock has declined 16.5% over the past year amid slowing sales momentum.

📅 Thursday, April 24th

• Merck & Co Inc (MRK): Merck is set to release its earnings report with analysts expecting earnings of $2.14 per share (up 3.3% year-over-year) on revenue of $15.36 billion (down 2.6% from the year-ago quarter). Market participants should closely monitor sales of Keytruda, Merck’s blockbuster cancer drug projected to generate $7.55 billion in quarterly revenue (an 8.7% year-over-year increase), as it remains the company’s primary growth driver amid challenges with Gardasil vaccine shipments to China.
  
  Despite consistently beating earnings estimates in the last four quarters, Merck’s stock has significantly underperformed the broader market (down 37.99% over the past 52 weeks versus the S&P 500’s 6.31% gain), making the company’s commentary on its full-year 2025 guidance of $8.88-$9.03 adjusted EPS and $64.1-$65.6 billion in revenue particularly critical for restoring investor confidence.

• American Airlines Group Inc (AAL): American Airlines is scheduled to release earnings report with analysts expecting a quarterly loss of $0.66 per share, representing a substantial year-over-year decline of 94.1%, on revenues of $12.62 billion, with a slight increase or flat from the year-ago quarter.
  
  Market participants should closely monitor whether the airline can exceed its revised guidance of a $0.60-0.80 per share loss and flat year-over-year revenue growth, which was downgraded from earlier projections due to challenging operating conditions including higher labor costs, macroeconomic uncertainty, and softness in domestic leisure travel. Despite the anticipated weak Q1 performance, traders should pay particular attention to management’s commentary on full-year 2025 outlook, especially regarding its ability to achieve the projected annual EPS of $1.70-$2.70 and generate the expected record free cash flow of over $2 billion, which could potentially reverse the stock’s troubling decline observed over recent months.

We hope this helps and happy trading!

– Trade and Travel Team