Apple Guidance, Reddit Surge Keep Bulls in Control as ISM Manufacturing Tests the Breakout

Friday opens with the bulls still holding the steering wheel, but the road is no longer perfectly straight. S&P 500 futures are slightly higher after Thursday’s record-close rally, Dow futures are firmer, and Nasdaq futures are modestly lower as traders separate the Apple and Reddit earnings positives from the drag of profit-taking in the already-stretched AI complex.

The market’s central question is not whether earnings season has been good. It has. Apple delivered a fiscal second-quarter beat and guided June-quarter revenue well above consensus, Reddit posted another explosive advertising quarter, and Alphabet’s cloud-led breakout from Wednesday is still supporting the broader tape. The question is whether that earnings breadth can keep overpowering a macro mix that includes 3.2% core PCE inflation, WTI crude above $105, and a Federal Reserve that just made clear it is in no rush to ease.

Today’s scheduled catalyst is lighter than Thursday’s GDP-PCE-Fed digest, but it matters because it speaks directly to margin pressure. The 10:00 a.m. ET ISM manufacturing report will show whether the factory sector is absorbing higher energy and supply costs while still expanding. A clean number keeps the breakout intact. A price-heavy, demand-light report could quickly turn this premarket calm into a second round of rates-sensitive selling.

Pre-Market Snapshot

Overnight Developments

Apple turns from risk event to support pillar

Apple removed one of the market’s biggest overnight risks. The company reported fiscal second-quarter revenue of roughly $111.2 billion and earnings of $2.01 per share, ahead of consensus expectations near $109.5 billion and $1.95. More important for today’s tape, management guided June-quarter revenue growth to 14% to 17%, well ahead of the Street’s roughly 9% expectation. Shares are indicated about 3% higher premarket, near $280 after closing Thursday at $271.35.

The quality of the reaction matters. Apple’s iPhone demand, stronger gross-margin guidance, and a less rigid approach to the old net-cash-neutral framework gave investors enough to look past memory-cost pressure and lingering China supply-chain complexity. For an index where Apple is still one of the largest weights, that keeps the Thursday breakout from immediately losing its anchor.

Reddit extends the digital advertising recovery

Reddit is the standout single-stock move this morning. Shares are up more than 16% premarket after the company posted first-quarter revenue growth of 69%, net income of $204 million, and second-quarter sales guidance above analyst estimates. The stock’s reaction is more than a small-cap social-media story. It confirms that digital advertising demand is not limited to Alphabet and Meta, and it adds a high-beta impulse to a market that has spent the week rewarding companies with clean revenue acceleration.

Oil remains the macro wildcard

WTI crude is trading near $105.75, up another 0.65% in early trade. That is below the most extreme levels seen during the latest Iran-Hormuz headlines, but it remains high enough to complicate the Fed narrative. Thursday’s PCE data showed headline inflation at 3.5% year over year and core PCE at 3.2%, both matching forecasts but still too hot for comfort. If oil stays above $100 through May, investors will be less willing to price any near-term policy relief.

Global Markets

Europe is mostly constructive in late-morning trade. Germany’s DAX is up 1.41% at 24,292.38, France’s CAC 40 is up 0.53% at 8,114.84, Spain’s IBEX 35 is up 0.78%, and the Euro Stoxx 50 is up 1.12%. The laggard is the U.K.’s FTSE 100, down about 0.66% near 10,310, reflecting a mix of currency, commodity, and defensive-sector rotation.

Asia was more uneven. Japan’s Nikkei 225 rose 0.38% to 59,513.12, helped by technology resilience and a weaker yen backdrop. China’s Shanghai Composite edged up 0.11% to 4,112.16, but Hong Kong’s Hang Seng fell 1.28% to 25,776.53 as investors remained cautious on China-facing growth and property-linked risk. The global message is not panic. It is selectivity.

Macro and Rates

Thursday’s macro releases left the market with a slightly uncomfortable combination. Q1 GDP grew 2.0%, below the 2.2% median forecast but still much stronger than the 0.5% prior reading. Initial jobless claims fell to 189,000 versus expectations for 212,000, confirming that the labor market remains firm. Personal income rose 0.6%, personal spending rose 0.9%, and core PCE rose 0.3% month over month.

That combination is why the 10-year yield sitting near 4.39% this morning is not an all-clear signal. Rates are lower from their immediate stress point, but the curve remains steep enough to show that inflation compensation and term premium are still active. The Fed can tolerate slower growth. It cannot easily tolerate slower growth with $105 oil and sticky services inflation.

Corporate News

Apple and Reddit dominate the morning, but the broader corporate message remains mixed. Amazon is indicated slightly lower after closing up 0.77% Thursday, as investors digest whether AWS strength has already been priced into the stock. Alphabet is fractionally higher premarket after Thursday’s nearly 10% surge, suggesting the market is letting that move consolidate rather than immediately reversing it.

Roku is up more than 8% premarket after a strong post-close reaction, while Sandisk is down nearly 6% despite a strong regular-session close, a reminder that memory enthusiasm is no longer moving in a straight line. The common denominator across these reactions is discipline: investors are rewarding clean guidance and punishing anything that looks stretched after a monster April.

Premarket Movers

Economic Calendar

The ISM headline is important, but the internals are more important. New orders will speak to demand, employment will test whether the labor market is really cooling, and prices paid will decide whether Thursday’s PCE print fades into the background or stays in the driver’s seat. A headline above 53 with stable prices paid would be the bulls’ cleanest outcome. A headline miss with sticky input costs is the bear case.

The AlphaEdge Prediction

Base case: the S&P 500 opens firm, trades in a 7,220 to 7,280 range, and tries to hold above Thursday’s breakout zone into the 10:00 a.m. ISM print. Apple should provide enough index-level support to offset some Nasdaq softness, while Reddit and Roku keep speculative breadth alive. The most likely tape is constructive but choppy, with leadership rotating from mega-cap AI into companies showing fresh guidance momentum.

Bull case: ISM confirms expansion without a sharp rise in prices paid, the 10-year yield stays below 4.40%, and S&P 500 buyers push through 7,280. In that scenario, the market starts treating Thursday’s hot PCE reading as an earnings-cycle inconvenience rather than a trend breaker. Apple could then pull quality growth higher while cyclicals participate through the Dow.

Bear case: ISM misses on new orders, prices paid accelerates, and oil holds above $105. That would revive the sticky-inflation trade and likely pull the S&P back toward 7,180 to 7,200. The first pressure points would be semiconductors, unprofitable software, small caps, and any stock that rallied on AI capex enthusiasm without delivering clean near-term cash-flow support.

My read: the path of least resistance remains modestly higher, but the easy part of the week’s rally is over. Bulls have earned the benefit of the doubt because earnings breadth keeps broadening. They lose it only if today’s manufacturing data says inflation pressure is moving back into the real economy faster than revenue growth can absorb it.