U.S. stock futures edge higher as traders assess some temporary technology-related exemptions to President Donald Trump’s elevated reciprocal tariffs. But Trump says that these products will still be subject to smaller levies imposed earlier this year and vowed to review the “whole electronics supply chain.” Exports from China surge in March, in a sign that U.S. importers were rushing to secure goods before Trump’s duties on Chinese items come into effect.
1. Futures higher
U.S. stock futures pointed higher on Monday, suggesting a positive start to the week for equities after a recent bout of tariff-driven turbulence.
By 03:30 ET (07:30 GMT), the Dow futures contract had added 245 points, or 0.6%, S&P 500 futures had gained 62 points, or 1.2%, and Nasdaq 100 futures had increased by 296 points, or 1.6%.
The main averages ended the prior session in the green, capping off a week that featured back-and-forth announcements around Trump’s tariff policies that caused stocks to whipsaw between sharp losses and steep advances. A bond market sell-off that flashed warning signs around the traditional safe-haven status of U.S. Treasuries also spooked investors.
Late on Friday, the White House announced that smartphones, computers and other electronics would be temporarily exempted from Trump’s punishing duties, bolstering sentiment (more below).
Along with more potential tariff pronouncements out of Washington, traders will likely be keeping close tabs this week on a fresh batch of corporate earnings and key economic data out of China.
2. Tech stocks after Trump tariff exemptions
Chinese technology stocks, including those that supply to Apple (NASDAQ:AAPL), rose sharply on Monday after the Trump administration signaled that some electronics would be exempt from his reciprocal trade tariffs.
While Trump did say that this was only temporary, and suggested that he would unveil a tariff rate on imported semiconductors over the next week, markets took some relief. Tech in particular has been battered by an intensifying U.S.-China trade war in recent weeks.
In China, Apple suppliers such as Luxshare Precision Industry Co Ltd (SZ:002475) and AAC Technologies (OTC:AACAY) Holdings Inc (HK:2018) rose, as did electronic devices giant Lenovo Group (HK:0992). The Hang Seng index also rallied.
Other Chinese tech stocks — such as chipmaker Semiconductor Manufacturing International Corp (HK:0981) and internet giants Alibaba (HK:9988), Baidu (NASDAQ:BIDU) (HK:9888) and Tencent Holdings Ltd (HK:0700) — recouped a measure of their recent losses.
Shares in Apple climbed in premarket U.S. trading as well.
China’s electronics manufacturers are heavily exposed to U.S. exports, partly because they play a key role in the supply chain of tech giants such as Apple. Trump’s escalating trade war threatens to destabilize this trend.
“The tariff exemptions […] represent a partial de-escalation of President Trump’s trade war with China,” said Paul Ashworth, Chief North America Economist at Capital Economics, in a note to clients.
3. Chinese exports jump
China’s trade balance grew more than expected in March, aided by an outsized surge in exports fueled by apparent front-loading before the imposition of U.S. trade tariffs.
The trade balance of the world’s second-largest economy jumped to a surplus of $102.64 billion in March, government data showed on Monday. The print was higher than expectations of $74.30 billion.
Exports surged by 12.4% versus a year-ago, greater than the 4.4% uptick expected by economists.
The spike likely reflected a push by U.S. importers to secure large quantities of overseas shipments before the Trump’s levies take effect.
4. Goldman Sachs (NYSE:GS) to report
Banking giant Goldman Sachs is due to headline a slate of corporate earnings on Monday, after many of its peers on Wall Street flagged that Trump’s tariffs could dent earnings and depress dealmaking.
Goldman Sachs is tipped to report first-quarter net revenue of $14.76 billion and adjusted earnings per share of $12.26, according to Bloomberg consensus estimates.
Last week, executives at lenders like JPMorgan Chase (NYSE:JPM) and BlackRock (NYSE:BLK) CEO Larry Fink warned that the levies may weigh on broader economic activity, with JPMorgan boss Jamie Dimon in particular saying he was “paying attention” to anecdotes that some IPOs and deals had been scrapped due to the tariffs.
Meanwhile, Wells Fargo (NYSE:WFC) CFO Michael Santomassimo said that corporate and commercial banking clients were beginning to take a “step back” and wait for more “certainty about where things are going” with Trump’s trade policy.
However, Morgan Stanley (NYSE:MS) CEO Ted Pick predicted that the U.S. economy would still avoid a recession despite noting risks from the tariffs.
5. Oil steadies
Oil prices steadied somewhat on Monday following recent losses that were driven by concerns that the trade spat between the United States and China — the two largest economies in the world — would weaken global economic growth and crimp fuel demand.
At 03:30 ET, Brent futures edged up by 0.3% to $64.93 a barrel. U.S. West Texas Intermediate crude futures climbed by 0.3% to $61.66 a barrel. Both contracts have lost roughly $10 a barrel since the start of the month.
Elsewhere, Bitcoin also found some footing as risk appetite improved marginally in the wake of the U.S. tariff exemptions, while an index tracking the dollar against a basket of major currencies drifted lower and gold prices inched back from a record high.
