What’s News in Markets: Nvidia’s China Rival, Tariff Tech Effect, McDonald’s Slips
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Hey, listeners, it's Saturday, May 3rd. I'm Francesca Fontana for The Wall Street Journal, and this is What's News in Markets, our look at the biggest stock moves of the week and the news that drove them. Let's get to it.

Trade and earnings were the two big stories of the market this week. And in many ways, they were intertwined, as investors have been watching for the effects of Trump's tariffs on corporations, on consumer spending, on the real world, really. A big focus was earnings from four of the magnificent seven super stocks. But more on those reports and how they moved the market later.

Notable trade developments this week injected some optimism into the stock markets, including Commerce Secretary Howard Lutnick saying he's reached a trade deal with an unnamed country, although no trade deals have been announced, Trump softening the blow of auto tariffs, and some signs of the ice thawing between Washington and Beijing.

This week, the Dow rose 3%, while the S&P 500 gained 2.9%, and the Nasdaq rose 3.4%.

Let's start by checking in with AI chip company NVIDIA and how the U.S.-China chipmaking rivalry is heating up. So in Monday's session, we saw investors reacting to the Wall Street Journal's report that China's Huawei Technologies is gearing up to test its newest and most powerful artificial intelligence processor, hoping it'll beat some of NVIDIA's chips. And Huawei has emerged as China's champion in the AI field.

Washington has attempted to hinder Beijing's chip industry by cutting off access to some Western chipmaking equipment, and Huawei has been on a U.S. trade blacklist for nearly six years. Despite these efforts, though, China's semiconductor industry is still advancing. And the latest news on those advancements weighed down Nvidia's stock price. Its shares fell 2.1% on Monday, but rebounded later in the week, and on a weekly basis gained 3.1%.

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Now, back to those magnificent seven earnings. As I mentioned, a handful of tech giants posted earnings during the week, so which ones lived up to the hype? Well, on Wednesday, we got the latest from Microsoft and Facebook parent Meta Platforms. Both posted better-than-expected results that reassured investors and boosted markets.

Indicators around trade were a big part of that. So for one, Meta said growth would remain steady, assuaging concerns that tariffs would hurt its digital advertising business. And Microsoft indicated that big corporate clients aren't slashing their technology budgets. At least, not yet.

Meta shares rose 4.2% on Thursday, while Microsoft shares jumped 7.6%. And on the week, Meta gained roughly 9%, while Microsoft gained about 11%. But that tech enthusiasm started to fade away from the stock market after Apple and Amazon's quarterly reports, after the market close on Thursday.

Apple's sales rose, but it said current tariff plans would add $900 million to its costs this quarter. Woof. And while Amazon predicted a solid quarter, the lower ends of its forecasts missed analysts' expectations. On Friday, Amazon shares ended roughly flat.

while Apple shares lost more than 3.5%. And on a weekly basis, Amazon edged half a percent higher, and Apple fell nearly 2%. Finally, the golden arches are losing some of their shine as the fast food chain's customers in the U.S. cut back on spending. McDonald's posted a bigger-than-expected drop in quarterly revenue, and this tracks with the larger trend we've been seeing this earnings season.

As consumer spending slows down, many restaurants have reported falling sales, including Chipotle Mexican Grill, Domino's Pizza, and Starbucks.

During Thursday's earnings call, Chief Executive Chris Kempchinsky told investors that low-income consumers pulled back on their spending, but so did middle-income households, while the higher-income crowd kept spending, illustrating what he called the divided U.S. economy. So how'd the stock do? Well, McDonald's shares fell 1.9% on Thursday and notched a weekly loss of 1.5%.

And now you know what's news in markets this week. You can read about more stocks that moved on the week's news in The Score, my column in the Wall Street Journal's Exchange section. Today's show was produced by Zoe Kolkin and Anthony Banzi with supervising producer Talia Arbel. I'm Francesca Fontana. Have a great weekend and I'll see you next Saturday.