Tariff Relief and Bullish Forecasts Set Positive Tone for U.S. Stocks Post-Holiday

Wall Street Opens Post-Holiday With Eyes on EU Tariffs and Tech Earnings

After a three-day break for Memorial Day, U.S. stock markets reopen today, Tuesday, May 27, with positive momentum building in futures trading. The S&P 500 last closed at 5,802.82 on Friday, May 23, down 0.67%, as pre-holiday caution and tariff uncertainty weighed on investor sentiment (Yahoo Finance).

Markets received a bullish boost over the weekend when President Donald Trump announced an extension of the 50% tariff deadline on European Union imports, moving it from June 1 to July 9. The reprieve followed what Trump called a “very nice” conversation with EU Commission President Ursula von der Leyen. This delay gave investors hope that further negotiations could avert an all-out tariff war, which had previously spooked equities and dampened risk appetite (Bloomberg).

As a result, futures on major U.S. indices were up in pre-market trading, and analysts are forecasting a strong rebound. Investors are also keeping an eye on corporate earnings reports this week, particularly from Nvidia, which may provide clues on the broader tech sector’s trajectory.

Analysts See Buying Opportunity as Market Correction Eases

Bank of America recently signaled that current market conditions may present a strategic buying window. Analysts argue that while the S&P 500 could face short-term pullbacks due to technical overbought signals, the index remains on a bullish trajectory. They project that the market could soon retest the 6,000 level and potentially climb to 6,266 by summer, citing resilience in earnings and reduced macroeconomic risks (Business Insider).

Morgan Stanley has also shifted to a more optimistic stance, officially turning bullish on U.S. equities for the first time in several quarters. The firm now sets a base target of 6,500 for the S&P 500 by mid-2026, with a potential upside scenario reaching 7,200. Their updated outlook is driven by expectations of stable inflation, firm consumer demand, and continued strength in mega-cap tech (MarketWatch).

With geopolitical risks temporarily muted and strong earnings ahead, market participants are likely to lean into risk-on strategies during this week’s trading sessions. Investors will also watch closely for macroeconomic indicators such as U.S. GDP revisions and labor market data, both of which could impact rate expectations and equity valuations.

As the shortened week kicks off, all eyes are on whether bullish sentiment can translate into a sustained rally, especially in tech and consumer cyclicals. For now, a cautious optimism prevails.