The U.S. stock market surged on Tuesday after President Trump postponed imposing a 50% tariff on imports from the European Union. The Vanguard S&P 500 ETF (VOO) gained 2% as a result. Trump had threatened the tariffs last week but then elated investors by delaying them.
He later stated he was “not looking for a deal” with the EU, only to say he planned to “quickly establish meeting dates” to discuss lowering trade barriers. Investor focus may now shift to earnings reports. Abercrombie & Fitch beat expectations with $1.59 per share in Q1, $0.20 better than expected.
Its stock jumped over 28% pre-market. Macy’s also beat with $0.16 per share versus the $0.15 expected. Its stock rose nearly 2%.
S&P 500 rises on tariff delay
However, both companies cut their guidance after reporting the beats. Abercrombie expects Q2 and full-year earnings to miss consensus estimates.
Macy’s warned Q2 earnings could be half of what Wall Street expects and set a lower full-year range. While neither is an S&P 500 component, their weak outlooks could weigh on the index. In analyst actions, Baird upgraded credit rater Fair Isaac Corporation to outperform with a $1,900 price target.
The firm called FICO Scores “the best financial model we’ve seen” and likely irreplaceable in the market, despite regulatory concerns. The S&P 500 looks set to extend Tuesday’s gains, with VOO trading about 0.1% higher pre-market. But the index’s direction may depend on further trade developments and the impact of the disappointing retail earnings guidance.
Check back for more updates as the trading day unfolds.
