S&P 500 steady after 9-day rally as investors await fed clarity
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U.S. equity futures opened the week on a cautious note, with S&P 500 futures steady early Monday following a rare nine-day winning streak — the index’s longest in over two decades. The milestone, last achieved in 2004, has reignited bullish sentiment, especially as the index now fully recovers from the losses sustained during April's tariff-driven selloff.
The catalyst behind the momentum came on Friday, when a stronger-than-expected nonfarm payrolls report showed the U.S. economy added 177,000 jobs in April, handily beating expectations of 133,000. The data helped ease concerns over an abrupt economic slowdown, particularly after a soft Q1 GDP print earlier in the week. This resilience in the labor market provided the foundation for the S&P 500 to extend its rally and recover all ground lost due to recent trade tensions.
Markets also found support in renewed signals of diplomatic engagement between Washington and Beijing. China confirmed it had received overtures from the U.S. expressing a willingness to resume trade discussions, offering a possible off-ramp from the confrontational stance that has rattled financial markets in recent weeks. The convergence of stronger domestic data and early signs of trade de-escalation provided the ideal backdrop for a risk-on rebound, with the S&P 500 now trading roughly 8% below its all-time high set in February.
Attention now turns to this week’s Federal Reserve meeting. The two-day FOMC session begins Tuesday and will culminate with Wednesday’s rate decision and a closely watched press conference by Chair Jerome Powell. While the Fed is expected to hold rates steady, market participants are keen to hear Powell’s assessment of recent macroeconomic data, including the implications of tariffs on the Fed’s policy path going forward.
With equities pricing in optimism and labor data suggesting resilience, the Fed’s tone will be pivotal in either extending or capping the current rally. Investors will be parsing Powell’s comments for any shift in balance-of-risk assessments, particularly with regard to inflation, labor strength, and external pressures from trade policy. Until then, markets may tread water, digesting earnings releases and geopolitical signals while positioning ahead of midweek clarity from the central bank.
The catalyst behind the momentum came on Friday, when a stronger-than-expected nonfarm payrolls report showed the U.S. economy added 177,000 jobs in April, handily beating expectations of 133,000. The data helped ease concerns over an abrupt economic slowdown, particularly after a soft Q1 GDP print earlier in the week. This resilience in the labor market provided the foundation for the S&P 500 to extend its rally and recover all ground lost due to recent trade tensions.
Markets also found support in renewed signals of diplomatic engagement between Washington and Beijing. China confirmed it had received overtures from the U.S. expressing a willingness to resume trade discussions, offering a possible off-ramp from the confrontational stance that has rattled financial markets in recent weeks. The convergence of stronger domestic data and early signs of trade de-escalation provided the ideal backdrop for a risk-on rebound, with the S&P 500 now trading roughly 8% below its all-time high set in February.
Attention now turns to this week’s Federal Reserve meeting. The two-day FOMC session begins Tuesday and will culminate with Wednesday’s rate decision and a closely watched press conference by Chair Jerome Powell. While the Fed is expected to hold rates steady, market participants are keen to hear Powell’s assessment of recent macroeconomic data, including the implications of tariffs on the Fed’s policy path going forward.
With equities pricing in optimism and labor data suggesting resilience, the Fed’s tone will be pivotal in either extending or capping the current rally. Investors will be parsing Powell’s comments for any shift in balance-of-risk assessments, particularly with regard to inflation, labor strength, and external pressures from trade policy. Until then, markets may tread water, digesting earnings releases and geopolitical signals while positioning ahead of midweek clarity from the central bank.