US Pre-Market: Inflation Fears Rise, Concerns Over Renewed US-Iran Conflict Intensify, US Pre-Market Losses Widen
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Geopolitical tensions led to a market sell-off, with the Dow Jones Industrial Average, Nasdaq Composite, and S&P 500 falling. Tech stocks, including semiconductor companies, experienced significant declines. Bitcoin also weakened, now viewed more as a risk asset. Bilibili's revenue grew 7% year-on-year, but its stock fell. Li Auto reported a year-on-year revenue decrease of 22.3% and a profit decline. Agilysys surged over 20% on strong earnings. UK employment dropped significantly in April, and Japan's economic growth is forecast to slow due to energy shocks and inflation. SpaceX's Starship V3 maiden flight and Fed Governor Barr's speech are upcoming events.
TradingKey - On Monday ET, U.S. President Trump announced the cancellation of a planned attack on Iran scheduled for Tuesday, after leaders of three major regional powers in the Middle East urged him to "hold off." As of press time, the Dow Jones Industrial Average fell 0.19%, the Nasdaq Composite dropped 0.61%, and the S&P 500 slipped 0.37%.
On Tuesday ET, U.S. stock index futures fell following a sell-off in technology stocks in the previous session, where a 2.47% drop in the Philadelphia Semiconductor Index dragged the broader market lower. Traders are also closely monitoring the oil market as U.S.-Iran tensions persist.
Spot gold prices traded weakly, briefly falling below the $4,500 mark in intraday trading during the previous session, primarily pressured by the sustained strength of the U.S. Dollar Index and concerns over intensifying global inflation.
Crypto assets weakened across the board as Bitcoin extended last week's sluggish trend, recording a cumulative decline of 1.5% so far this week. Risk assets were once again immediately sold off by the market due to geopolitical tensions, as the market increasingly prices Bitcoin as a risk asset rather than digital gold.
Market Movement
US-listed Chinese stock Bilibili flipped from a gain to a loss. Bilibili's share price once swung from a 4% gain to a decline of over 1.5%. The company released its first-quarter results, with total net revenue reaching RMB 7.47 billion ($1.08 billion), a 7% increase year-on-year.
Shares of US-listed Li Auto continued to slide in pre-market trading, falling more than 4%. Previously, Li Auto plummeted nearly 10% in a single trading session due to the impact of its earnings report. The company's total annual revenue was RMB 112.3 billion, down 22.3% year-on-year; net profit was RMB 1.1 billion, down 85.8% year-on-year; and non-GAAP net profit was RMB 2.4 billion, a 77.5% decrease year-on-year.
Software stock Agilysys (AGYS) surged more than 20% in pre-market trading. Fourth-quarter revenue was $82.9 million, compared to the IBES estimate of $81.6 million, while Agilysys reported fourth-quarter adjusted earnings per share of $0.63, beating the IBES estimate of $0.50.
High-profile concept stocks broadly declined. Growth stocks, led by the technology sector, were sold off as geopolitical conflicts fueled risk-averse sentiment. Micron fell over 2%, Intel dropped more than 1%, SanDisk slumped over 3%, TSMC declined over 1%, Nvidia shed nearly 1%, Qualcomm fell over 2%, and AMD dropped over 1.5%.
Market News
UK employment fell sharply in April as the conflict in Iran dimmed the economic outlook. British employers significantly reduced headcount in April, suggesting that labor demand is weakening as the Iranian conflict persists. Tax data released by the Office for National Statistics on Tuesday showed that payrolls fell by 100,000 in April, following a 28,000 decline in March. This drop far exceeded economists' expectations of 10,000, with the retail sector suffering particularly heavy losses.
Japan's economic growth is forecast to slow in 2026 amid a combination of energy shocks and high inflation. Japan is facing a weaker economic outlook for the second quarter and beyond, with persistent energy shocks and inflation expected to dampen growth. Prime Minister Sanae Takaichi is considering a supplementary budget to subsidize gasoline and fuel prices this summer, but a senior economist at ING noted the budget serves as emergency relief rather than economic stimulus, offering limited multiplier effects on growth.
An Iranian lawmaker says Iran "never left the negotiating table." According to reports from Iran on the 19th, a member of the Iranian Parliament stated in an interview that Iran has never initiated a war and has never left the negotiating table. The lawmaker also stated that negotiations must be based on respect and the recognition of the Iranian people's legitimate rights.
Key Data/Events Preview
SpaceX Starship V3 is set for its maiden flight at 6:30 PM ET on May 19.
Federal Reserve Governor Barr will deliver a speech on May 20 ET.
This content was translated using AI and reviewed for clarity. It is for informational purposes only.
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