Tariff talks continue

28/04/2025 | Zurich Ireland

Weekly updates

Equities finished the week sharply higher led by the Magnificent Seven which were up over 8%.

Markets cheered the announcement from President Trump that he was no longer considering removing Fed Chair Jerome Powell. However, markets ended the week on a less buoyant note following a series of conflicting updates from US and Chinese officials regarding the progress (or lack thereof) of trade negotiations.

The easing tensions and improved sentiment saw Gold move lower for the week as a slightly more ‘risk on’ attitude prevailed. US treasuries also posted modest gains for the week, supported by the positive news flow in relation to both tariffs and the Fed’s independence.

Given the ongoing economic uncertainty, consumer sentiment remains depressed. However, ‘hard data’ from the US last week was mostly positive. For example, durable goods orders were stronger than expected in March, as new orders rose a stark 9.2%. However, residential property sales dropped nearly 6% across the month.

Company earnings continue to roll in, with Alphabet reporting upbeat numbers on Thursday which helped lift both its share price and the overall market. Tesla also rose following the announcement that Elon Musk will step back from his DOGE related duties and focus more on the company directly.

On the currency front, the US dollar saw its first weekly gain in a month but is still hovering close to three-year lows.

In Europe, PMI data disappointed. The manufacturing figure rose to 48.7 whilst the services figure fell more than expected to 49.7. Both figures now below the key 50 level which signifies a contraction in economic activity. Despite this ECB Chief Economist stated that a eurozone recession is still ‘unlikely’. UK PMI also both came in under 50, at 44.0 (manufacturing) and 48.0 (services) respectively.

Equities

Global stocks finished up 4.0% in euro terms and 4.2% in local terms last week. Year-to-date global markets are down by -10.7% in euro terms and down by -1.9% in local terms. The US market, the largest in the world, finished up 4.5% in euro terms and 4.7% local terms.

Fixed Income & FX

The US 10-year yield finished at 4.2% last week. The German equivalent finished at 2.5%. The Irish 10-year bond yield finished at 2.8%. The Euro/US Dollar exchange rate finished at 1.14, whilst Euro/GBP finished at 0.85.

Commodities

Oil finished the week at $63 per barrel and is down -19.9% year to-date in euro terms. Gold finished the week at $3,320 per troy ounce and is up 15.2% year-to-date in euro terms. Copper finished the week at $9,376 per tonne and is down -1.3% year-to-date in euro terms.