Updated 04/21/2025
Our Perspective on the Markets Last Week:
U.S. markets stumbled over the holiday shortened week as volatility remained elevated. The price change of select U.S. indexes for the week was: S&P 500 (-1.50%), Dow (-2.66%) and the Nasdaq (-2.62%). The 10yr. Treasury note yield fell -0.14 percentage points to 4.34%.
Markets experienced notable volatility last week, influenced by a blend of corporate earnings, economic data, Federal Reserve communications, and of course, tariff uncertainty.
Strong earnings from major financial institutions highlighted resilience in the banking sector and encouraged investor confidence early in the week.
However, sentiment turned much more cautious mid-week after Nvidia announced it expects a $5.5B revenue loss in Q1 due to new U.S. export restrictions on its H20 AI chips to China. This led to an -8.5% drop in Nvidia's stock and triggered a broader sell-off in the technology sector. Other semiconductor companies, including AMD and ASML, also reported potential revenue hits from similar export limitations.
Equity values took another leg lower on Wednesday afternoon following remarks from Fed Chair Jerome Powell that President Trump's tariffs could exacerbate inflation while slowing economic growth. He also indicated that the Fed is hesitant to cut interest rates amid these challenges, throwing some cold water on hopes for monetary policy support in the near term.
Retail sales in March leapt 1.4% higher, notching the largest monthly increase in more than two years, as consumers pulled forward purchases of big-ticket items before potential tariff price increases.
Looking Ahead:
While the U.S. and China’s trade war will remain the top focus, corporate earnings reports will have a greater influence on sentiment as some mega-cap tech, along with several other key companies, are set to report this week.
In terms of reporting companies, Tesla and Alphabet (Google) earnings will be the headline events. GE, Verizon, AT&T, Boeing, Pepsi, IBM, Proctor & Gamble, 3M, and Service Now will also be heavily influential.
Market participants will pay attention to commentary from Federal Reserve officials scheduled throughout the week for further hints regarding monetary policy direction, especially given recent discussions about inflation and interest rate trends.
Stay Informed. Receive weekly updates of our outlook on the markets in your inbox.
Probability of an interest rate change at next FOMC meeting:
Current Target Rate is 4.25% - 4.50%
Select Economic Data Releases
*Colored icon denotes a new data release.
Important Disclosures: The material presented is general communication being provided for informational purposes only. It is educational in nature and not designed to be a recommendation for any specific investment product, strategy, plan feature or other purpose. Opinions and estimates offered constitute Investment Management Corporation’s judgment and are subject to change without notice, as are statements of financial market trends, which are based on current market conditions. Some of the information provided has been obtained from third party sources believed to be reliable, but no warranty of accuracy is given. IMC has not taken into account the investment objectives, financial situation or particular needs of any individual investor. There is a risk of loss from an investment in securities, including the risk of loss of principal. Different types of investments involve varying degrees of risk, and there can be no assurance that any specific investment will be profitable or suitable for a particular investor's financial situation or risk tolerance. Any forward-looking statements or forecasts are based on assumptions and actual results are expected to vary. The material presented does not contain sufficient information to support an investment decision and it should not be relied upon by you in evaluating the merits of investing in any securities or products.