Financial Market Update – Week of 4/21/2025

Presented by Marc Aarons

Hope you are doing well. Last week brought more tariff and interest rate developments, along with strong retail sales numbers. Read on for a bite-sized overview of what you should know.

Weekly Stock Index Performance

Major U.S. stock indexes traded modestly lower last week as tariff uncertainty persisted and export restrictions on semiconductor chips were announced.

• The S&P 500 finished the week lower by 1.50%.
• The Dow Jones Industrial Average fell by 2.66% for the week.
• The Nasdaq 100 declined by 2.31% last week.

Retail Clearance Sale

• The advanced estimate for March Retail Sales data showed a rise of 1.4% for the month, beating Dow Jones estimates of 1.2% — a large increase from February’s monthly increase of 0.2%. Motor vehicles and parts dealers in particular saw a surge in sales.
• Some analysts described it as akin to a “gigantic clearance sale” before tariff-impacted pricing, with the broad expectation for prices to be higher a year from now.  Could consumers be overly fearful of higher prices to come?

Interest(ing) Rates

• The European Central Bank (ECB) cut interest rates last week, leaving a feeling that the central bank has left the door open for more rate cuts while President Trump is urging Federal Reserve Chair Jerome Powell to do the same here at home. The drama between the two continues to pick up steam.
• Looking at rate cut probabilities in the U.S based on futures markets, there is an 86.2% chance of no change in interest rates at the May Fed meeting, leaving only a 13.8% chance of a quarter-point rate cut according to the CME FedWatch Tool at the close of last week.
• The ECB’s benchmark deposit rate sits at 2.25%, while the U.S. benchmark overnight lending rate currently sits at 4.33%.

Trade Tensions: Dollar Down, Gold Up

• The gold rally continued amidst trade tensions last week, with all-time highs made last week as the shiny yellow metal crossed the $3300 level. That’s a nearly 25% gain this year alone for the price of spot gold.
• On the other hand, the U.S. dollar has fallen somewhat sharply in 2025, with the U.S. Dollar Index (DXY) falling to three-year lows. The U.S. Dollar Index measures the U.S. Dollar’s strength against a basket of six major currencies. Trade tensions and uncertainty are factors.

The Week Ahead

• It’s a quiet week for economic data releases this week, with some Flash Manufacturing and Services data on Wednesday. Eyes will continue to be glued on tariff-related developments and earnings season in its early stages.

Please don’t hesitate to reach out with any questions or concerns.

Marc Aarons may be reached at 714-887-8000 or Email Marc

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This communication is from Money Managers, Inc.; a Securities and Exchange Commission registered investment advisor.  Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any securities, and past performance is not indicative of future results.  Investments involve risk and are not guaranteed.  Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed here