Category: Newsletter

Technology stocks endured their worst week in months as investors reassessed AI capital spending returns; however, broader markets demonstrated resilience with a strong late rally pushing the Dow briefly past 50,000 for the first time.

While the US-India trade deal offers a geopolitical reprieve for Indian markets, the macro focus in the US is narrowing on the health of the labor market.

With the January jobs report delayed and layoff announcements surging, markets are increasingly assessing whether the 10th consecutive quarter of earnings growth can resist emerging cracks in the employment.

Markets navigate a volatile backdrop: from divergent U.S. earnings and violent precious‑metal moves to shifting Fed leadership and AI deal dynamics.

Focus shifts to Trump’s surprise pick of Kevin Warsh for Fed Chair, which adds a hawkish tilt to policy expectations.

US markets observe a rotation towards small caps, away from the stretched valuations seen in mega cap stocks.

The global backdrop remains of elevated uncertainty as Trump mounts pressures on nations supporting Greenland’s autonomy, while tensions remain elevated in Iran amid dire economic conditions.

Economic and policy risk were at least temporarily relegated to secondary status as geopolitical risk emanating from the war between Israel and Iran took centrestage. We expect financial markets to be in ‘risk off’ mode until clarity emerges about the extent and duration of damage caused by the conflict. Oil prices, in particular, are in focus.

Last week, the S&P 500 crossed 6,000 marking a bull market in a drama filled week which included a public spat between Donald Trump and Elon Musk and the first direct talks between the US president and the Xi Jinping since Liberation day.

Trump’s tariff strategy faces an unexpected speed bump, his “big, beautiful bill” awaits Senate approval and as the 90-day tariff pause deadlines comes closer, the Trump administration has started to get frantic with aggressive statements on China & Europe.

Last week started off with a détente in the US-China trade war sending global stocks soaring and US indices paring 2025 losses. Soft US data continued to disappoint, but hard data remains resilient. On Friday, US credit rating was downgraded by Moody’s to Aa1. History suggests that the effect, if any, will be short-lived.

Markets had a relatively calm week. The tone was somewhat optimistic as the Fed acted in line with expectations and there were indications of progress on trade negotiations. The UK was first off the block on May 8th, and was followed yesterday by the all-important agreement with China to keep tariffs at 30% for the next 90 days. Markets have responded very positively and have jumped almost across the board. We recommend clients use this opportunity to lock in some profits and rebalance their portfolios.

Wall Street saw their longest winning streak since 2004 on the back of a few factors, all having one common factor, Donald Trump. The cherry on top of the cake came in the form of stronger than expected guidance from the big Tech firms. Oil, on the other hand, saw a big drawdown after OPEC announced an increase in output.

U.S. stocks drifted lower in a holiday-shortened week amid trade tensions, further investigations into pharma and semiconductor imports, mixed corporate earnings, and Trump’s public criticism of the Fed Chair. Global markets responded variably, with Chinese and Indian equities seeing gains on stimulus hopes and positive economic signals, while European financial stocks rose after regulatory changes by the UK.

We continue to recommend diversification as a way to deal with this uncertain period.