Disney Shares Surge 10% on Earnings, Fed Decision Awaited

U.S. stocks opened higher ahead of the Federal Reserve's May interest rate decision and Chairman Jerome Powell's speech. However, Chinese stocks listed in the U.S. experienced a decline.

Analysts suggest that due to the robust U.S. economic data, the Federal Reserve is likely to maintain the current interest rate, despite pressure from the Trump administration.

Disney shares surged over 10% after the company reported better-than-expected earnings for the second fiscal quarter, leading to a significant increase in its full-year profit guidance.

In contrast, the Nasdaq Golden Dragon China Index, which tracks Chinese companies listed in the U.S., saw a notable decline, with many individual stocks turning red. Notable decliners included WANDA Data and Kingsoft Cloud, both of which fell by more than 7%.

The upcoming Federal Reserve meeting is anticipated to be a pivotal moment. At 2 AM Beijing time, the Federal Reserve will announce its May interest rate decision. Following this, at 2:30 AM, Chairman Jerome Powell will hold a press conference to discuss the monetary policy decisions and answer questions from reporters.

The Federal Reserve faces a challenging decision due to the impact of the U.S. government's tariff policies. The central bank must choose between maintaining high interest rates to address inflation or lowering rates to stimulate economic growth and employment.

Market predictions, as indicated by the CME FedWatch Tool, suggest that there is no likelihood of a rate cut in May, with the interest rate range expected to remain at 4.25% to 4.5%. The strong April non-farm payroll data released last Friday provides the Federal Reserve with the flexibility to maintain the current stance.

Previously, the Trump administration had been exerting pressure on the Federal Reserve to lower interest rates. President Trump even threatened to fire Chairman Jerome Powell over the issue. In an interview with the U.S. Consumer News and Business Channel on May 5, U.S. Treasury Secretary Steven Mnuchin stated that one of the administration's goals is to reduce interest rates to the lowest level in a decade.