Pedestrians walk past the north entrance to the U.S. Treasury Department headquarters building on April 30, 2025, in Washington, DC. <\/p>\n
J. David Ake | Getty Images<\/p>\n
U.S. stocks popped last week on the back of a trade truce between America and China, in which they mutually agreed to cut tariffs for 90 days<\/a>. Technology stocks soared, with Tesla and Nvidia leading the pack. Absent new developments on the tariff front, however, it’s unclear if this buoyant sentiment can last.<\/p>\n For one, the U.S.’ credit rating was downgraded by Moody’s Ratings to the second highest. This means investors could demand higher returns for U.S. Treasurys amid their ostensibly lower trustworthiness. Rising Treasury yields, in turn, could pressure stocks. Even though Moody is merely the latest<\/a> to join Standard & Poor’s and Fitch Ratings in bumping down the U.S. from the top rating \u2014 which did so in 2011 and 2023 respectively \u2014 it might send another crack through an already fragile stock market.<\/p>\n Although Nvidia was one of the winners of last week’s rally, it is still contending with chip export restrictions to China and increased scrutiny over its business activities. That’s a big deal because China’s artificial intelligence sector is “not behind<\/a>” that of the U.S., and will probably reach around $50 billion<\/a> within three years, according to Nvidia CEO Jensen Huang. Losing out on that market would be a “tremendous loss,” he added.<\/p>\n Whether last week’s rally can be sustained will rely, then, on the headlines that will come from the White House this week.<\/p>\n What you need to know today<\/p>\n Moody’s cuts U.S.’ credit rating<\/strong> Winning week for U.S. stocks<\/strong> Nvidia denies sending chip designs to China<\/strong> Trump says he will broker peace<\/strong> Biden diagnosed with prostate cancer<\/strong> [PRO]<\/strong> Retail earnings in focus this week<\/strong> And finally…<\/p>\n Downtown Beijing on May 2, 2025.<\/p>\n Greg Baker | Afp | Getty Images<\/p>\n
Moody’s<\/a>\u00a0Ratings cut the United States’ sovereign\u00a0credit rating<\/a> down\u00a0one notch to\u00a0<\/strong>Aa1 from Aaa<\/a>, which is the highest possible, citing the growing burden of financing the federal government’s budget deficit and debt. Treasury Secretary Scott Bessent on Sunday called the downgrade a “lagging indicator<\/a>,” claiming it reflects conditions during the Biden administration.<\/p>\n
All major U.S. indexes rose Friday<\/a>. For the week, the S&P 500<\/a> surged 5.3% and the Dow Jones Industrial Average<\/a> climbed 3.4%. The Nasdaq Composite<\/a> popped 7.2% on the back of strong showings from technology stocks<\/a> such as Tesla<\/a> and Nvidia<\/a>, which jumped 17% and 16% respectively on the week. U.S. futures slipped Sunday<\/a> evening. <\/strong>Europe’s regional Stoxx 600<\/a> added 0.4% Friday. Shares of Richemont<\/a> jumped 7% after the Cartier owner posted better-than-expected fiscal fourth-quarter sales<\/a>, in a sign wealthy consumers are still spending on luxury<\/a>.<\/p>\n
Following a report<\/a> in the Financial Times that Nvidia is working on a research and development center in Shanghai in light of new U.S. export curbs<\/a>, the chipmaker told CNBC it is “not sending any GPU designs to China<\/a> to be modified to comply with export controls.” A source familiar with the matter told CNBC that the company is leasing new space for current employees, but is not sending any IP or GPU designs there.<\/p>\n
U.S. President\u00a0Donald Trump\u00a0said Saturday in a post on Truth Social that he plans to speak separately to Russian President\u00a0Vladimir Putin\u00a0and Ukrainian President\u00a0Volodymyr Zelenskyy\u00a0on Monday in an effort to reach a ceasefire between the two countries<\/a>. America is also working with Britain to establish an India-Pakistan ceasefire<\/a> alongside “confidence-building measures” and dialogue, U.K. Foreign Minister David Lammy said on Saturday.<\/p>\n
Former U.S. President Joe Biden on Friday was diagnosed with an “aggressive” form of prostate cancer<\/a>, his office said on Friday. “The cancer appears to be hormone-sensitive which allows for effective management,” his office added.<\/p>\n
Stocks rallied last week as investors cheered the White House’s deal with China to reduce tariffs on each other. This week, keep an eye out on earnings from Home Depot<\/a>, Target<\/a> and\u00a0 TJX<\/a> for an indication of how the American consumer has been holding up<\/a> \u2014 and how those big retailers will deal with tariffs.<\/p>\n