Financial Markets Update Since Good Friday
The financial markets have experienced significant turbulence since Good Friday, April 18, 2025, driven by geopolitical tensions, trade policy shifts, and macroeconomic signals. Here’s a concise recap of the key developments through today, April 24, 2025, along with a preview of major events to watch through the end of this week.
Market Movements Since Good Friday
Equities Slide and bounce on Trump comments
Since the U.S. markets were closed on Good Friday, that made the weekend seem longer particularly with Trump calling for the demise of Chairman Powell. Easter Monday, April 21, saw little rising with Trump’s words seen as a threat to the independence of the Fed and by association global confidence in the dollar. It seems the US Administration is watching markets because every time there is a catastrophic potential some soothing words come out. Trump did this on Apr 23, over Powell, hinting he didn’t want to remove him now
The S&P 500 is up 1.91% on the week currently: the Dow Jones Industrial Average +0.6%, and the Nasdaq100 up 1.33% all reflecting the two-day relief surge. Scott Bessent, US Treasury Secretary initially backed up Trump’s speedy China trade settlement thoughts calling the U.S.-China trade war “unsustainable,” hinting at potential de-escalation. Slight tempering of his view on speed on Thursday by Bessent along with China distancing themselves from being in talks until their respect threshold is met, pressed the pause button on the rally
Gold Surges to Record Highs
Gold has been a standout performer, climbing to a new all-time high of $3,500 per ounce, driven by investor demand for safe-haven assets amid geopolitical uncertainty and tariff-related fears. This quickly reversed 7% to $3,250 on the sentiment flip-flop. Just unwinding the anti-$ and safe haven flows could see a decent pullback in the uptrend
Treasury Yields Retreat Slightly
U.S. Treasury yields have eased from recent highs, with the 10-year yield dropping to around 4.35% all week. Investors initially sought safety in bonds amid equity selloffs but correlations are high with US bonds seen as US assets first and another $ to sell. Yields remain elevated compared to early April, signaling ongoing inflation concerns, but it seems Bond vigilantes are being heard now at the Whitehouse
U.S. Dollar Weakens
The U.S. dollar has faced pressure, slipping to a three-year low against major currencies, down over 8% from its 2024 year-end level. This decline has been exacerbated by trade war fears and public criticism of Federal Reserve policies by President Trump, which briefly sparked a selloff in U.S. assets.
Tariff Developments Drive Volatility
The markets have been whipsawed by trade policy headlines. Trump’s initial tariff threats, including a 145% rate on Chinese imports, triggered sharp declines earlier in April. A temporary exemption for tech products announced on April 11 provided a brief rally, but renewed criticism of Fed Chair Jerome Powell and China’s retaliatory tariffs kept markets on edge.
Earnings Season Mixed
Early Q1 earnings reports have shown resilience, with 76% of S&P 500 companies beating estimates by an average of 6.2%. However, warnings of economic slowdowns due to trade disputes have tempered enthusiasm, particularly in sectors like financials and technology. Tesla’s weaker-than-expected earnings added pressure on tech stocks and is seen as a bottom test for the market. Classic hype stock that should trade in the swap into something else basket
The word recession has been mentioned in 43% of reports
Key Drivers
The primary catalyst for market movements has been uncertainty surrounding U.S. trade policies. Trump’s aggressive tariff stance, followed by partial exemptions and retaliatory moves from China, has created a volatile environment. Additionally, Fed Chair Jerome Powell’s cautious stance on interest rates, projecting higher inflation and slower growth due to tariffs, has kept investors wary. Consumer sentiment has also soured, with the University of Michigan’s April survey dropping to 57.9, the lowest since June 2022, reflecting tariff-related concerns. Hard data though, measures of hiring and buying, have mainly held up.
Retail giants such as Walmart have visited the President to warn him of the very real potential for empty supermarket shelves very soon due to the tariff chaos. Many container ships have not even left China yet so there is a likely shortfall on supplies which will be very easy media images for Trump critics to use.
Pepsico has moved forecasts from growth to a 3% loss for Fiscal FY25 on rising production prices and tariff confusion
American Airlines, South West Airlines and Alaska Air all withdrew their full-year guidance after domestic travel demand declined in the first quarter and macro uncertainty made it difficult to chart a flight path!
ServiceNow up 10% so not much wrong with AI demand in the year of the Ai agent
Alphabet and Intel after hours for specific AI and semiconductor demand trends amid the tariff debacle
IBM less Big Blue more Big Red -7% on sales miss on discretionary like consultancy
Data has been light with Global PMIs the highlight with provisional reports for April seeing Services miss expectation in the main. Germany’s IFO surveys saw an uptick across the board. The Fed’s Beige Book was mucky brown with 107 mentions of Tariffs and 89 uncertainties from respondents.
Preview: Major Events Through Week’s End (April 25, 2025)
Friday, April 25
University of Michigan Consumer Sentiment (Final):
The preliminary reading showed a sharp decline, and any further deterioration could signal weakening consumer confidence, impacting retail and discretionary stocks.
UK & Canada Retail Sales:
any material weakness from the consumer could reflect in rate cut bets
Earnings Reports:
Key companies like Alphabet, Intel, and Comcast report Thursday, offering insights into tech and consumer sectors. Alphabet’s results could move the Nasdaq, given its weight in the index.
Trade Policy Updates:
China made a very particular rebuttal of any US claims that negotiations were progressing. They denied them having taken place at all.
Global Macro Data
Global flash PMIs for manufacturing and services mainly showed a miss on the Services side, with the tariff impact expected on the goods side of the economic activity. This has the potential to just up the pressure on the recession concerns
Outlook
The markets remain highly sensitive to trade policy developments and Fed rhetoric. While the partial tariff exemptions and Powell’s reaffirmed position have provided some stability, the risk of renewed escalation looms large. Investors should brace for continued volatility, with gold and bonds likely to remain in demand as safe havens. The upcoming earnings and consumer sentiment data will be critical in gauging whether the market can stabilize or if further declines are ahead. Is the bottom in yet? Starting to look like 1998, bulls spooked away from buying still high 20x PE for the SPX, Fed likely to eventually cut then boomtime as underweights chase back into the US
Actionable take-aways
- We’ve already seen one Fake news set up with the 90-day delay on tariffs. Are we being set up for a large China one too?
- Use April 7th lows as ultimate market breakdown otherwise look for continued bullish structure
SPX chart
Dollar
Dollar near a significant bottom, expect some churning into it. Momentum improvement setting up for a final low on better MACD…should start seeing good two way markets in dollar pairs soon
Oil
Oil has consolidated and into new OPEC+ supply increase arguments…volume picking up into weak days…are we due a support zone re-test to finish the rally?
CL F chart
Gold
Gold another big figure notched on the vault wall, $3500, this week. All on a slight wobble about Trump the Dump and his trusty side-kick Powell. It was a threat to $ trust as a reserve asset. It’s another chart that may have topped and has a lot of loose hands holding it. The overshoot could be a significant top. No real divergence with momentum though at the top so shorts keep the aTH in view for SL
Stay tuned for daily updates on discord as we navigate this dynamic market environment!
