US Stock Futures Drop With Tech Earnings in Focus: Markets Wrap

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Four of the so-called Magnificent Seven — Microsoft, Apple Inc., Meta and Amazon.com Inc. — are reporting earnings this week. Analysts expect the group — which also includes Google-parent Alphabet, Tesla Inc. and Nvidia Corp. — to deliver an average of 15% profit growth in 2025, a forecast that’s barely budged since the start of March despite the flareup in trade tensions.

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“The focus on tech earnings here, or rather guidance, will be key,” said Sat Duhra, a portfolio manager at Janus Henderson Investors in Singapore. “Its been a significant driver of performance and there has been some rotation into more defensive high yield names.”

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In Asia, a gauge of China’s factory activity signaled the deepest contraction since December 2023, revealing early damage to the world’s second-biggest economy from the trade war with the US. After the data, offshore yuan edged lower, extending its first monthly decline this year. Copper retreated from its highest close since early April.

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Shares in Samsung Electronics Co. dropped as its chip business reported a roughly 40% drop in profit after US export controls dented sales of its high-end chips.

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Meanwhile, US real GDP growth likely cooled to a standstill in the first quarter as Trump’s policy shifts disrupted activity, according to Bloomberg Economics before the data is published later Wednesday.

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Some emerging market countries such as India will do quite well in the current environment, said Mark Mobius. The veteran emerging-markets investor has kept the bulk of his funds’ holdings in cash given that the trade-related uncertainty is likely to persist for up to six months.

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“At this stage, cash is king. So 95% of my money in the funds are in cash,” Mobius said in an interview on Bloomberg Television. “Right now, we got to keep the cash and be ready to move when the time is right.”

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In the latest pivot in Trump’s trade strategy, the US president signed an executive order easing the impact of his auto tariffs, preventing duties on foreign-made vehicles from stacking on top of other levies and lessening charges on parts from overseas used to make vehicles in the US.

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Trump also renewed criticism of Fed Chairman Jerome Powell as he championed his economic policies and tariff regime during an event on Tuesday to mark his 100th day in office. Trump said China deserved the steep tariffs he imposed on their exports and predicted Beijing could find a way to reduce their impact on American consumers.

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“The balance of risks still argues for expecting renewed declines in equity prices from current levels and for adding downside protection,” wrote Vickie Chang, a strategist at Goldman Sachs. “For markets, the most immediate question is whether there is fresh downside to come.”