📣 Market Wrap
After a few days of sideways movement, stock markets rose again this week, with the S&P 500 extending its recovery to ~15% above April’s lows, driven by a series of positive news items.
On Tuesday, US Treasury Secretary Bessent indicated that Q1 GDP data, which initially showed a 0.3% contraction, would likely be revised higher, with no signs of the US economy being in recession. That same day, Bessent's announcement that he would be heading to Switzerland for China trade talks helped boost investor optimism.
The positive momentum continued on Wednesday, with Trump easing export restrictions on semiconductors, sending chip stocks surging. On Thursday, Trump announced a comprehensive US-UK trade deal, signaling more agreements to follow, which further fueled optimism in global markets.
In a further boost to sentiment, the Bank of England cut interest rates from 4.5% to 4.25% and upgraded its 2025 GDP forecasts, reflecting a more positive economic outlook in the UK.
Notably, Palantir [PLTR] shares fell sharply after the software analytics company’s Q1 results, despite strong numbers, failed to meet investor expectations. The c.15% sell-off was significant, but even after the drop, Palantir’s stock is still up nearly 40% this month.
Meanwhile, Google’s [GOOG] stock sold off c.6% following Apple’s [APPL] AI announcement, as investors reacted to Apple’s increasing focus on artificial intelligence. This sparked concerns that Google may face increased competition in search, given the rapidly expanding AI space, weighing on its stock despite broader market gains.
Overall, this week was characterized by a recovery in US equities, driven by trade optimism, positive economic data, and encouraging global trade developments, particularly the US-UK deal and easing tariffs. However, sell offs in the tech sector, as seen with Palantir and Google, are reflective that lofty valuations remain.
📈 Market Data
Weekly
S&P500: -0.38% FTSE 100: -0.47% Gold: +2.89%
YTD
S&P500: -3.49% FTSE 100: +3.61% Gold: +25.41%
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