Apr 28, 2025
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“As sure as time, history is repeating itself, and as sure as man is man, history is the last place he’ll look for his lessons.” – Harper Lee
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
After five straight weeks where the market has essentially gapped down 1% or more at the open to start a week, futures are surprisingly muted this morning, with the S&P 500 indicated to open fractionally lower (~0.10%). The subdued tone comes as there has been no change to the trade situation between the US and any of its trading partners. You can say no news is good news, but the longer we go with no news, the more anxious the market will become. In Europe, stocks are starting the week positively with the STOXX 600 up nearly half a percent, Germany and France lead the way higher, while Spain and Italy lag.
This will be an important week for economic and earnings-related news outside of trade-related news. On the earnings front, a third of the companies in the S&P 500 are scheduled to report, including Apple (AAPL), Microsoft (MSFT), Amazon.com (AMZN), and Meta (META). The pace of economic data will be just as busy. While Dallas Fed is the only report on the calendar today, on Tuesday, we’ll get Consumer Confidence for April and JOLTS for March. On Wednesday, we’ll get ADP for April and the first read of Q1 GDP, followed by jobless claims and April Manufacturing PMI for April on Thursday. Then Friday, the week closes out with the April Employment report. After all these reports, we should have a much better read on how all the uncertainty over trade has impacted the economy.
After rallying as much as 12.4% month to date and rising above $3,500 per ounce last week, gold prices have significantly pulled back in the last four trading days. This morning, the price is little changed, trading right around $3,300 per ounce. While still up nearly 6% for the month, the magnitude of the gain has been more than cut in half.
When gold last hit a 52-week high on Tuesday (4/22), it pulled back sharply lower intraday and finished the day more than 2.5% from its intraday high. Since the mid-1970s, it was just the 33rd time that its price hit a 52-week high but finished the day down more than 2.5% from the intraday high. The chart below shows every prior occurrence with a red dot. While these types of reversals were evident at prior peaks, they were also scattered throughout longer-term uptrends. The most recent occurrence before last week was almost exactly a year earlier in mid-April of last year, and we all know what gold has done since then. In other words, it’s hard to put too much significance into any one day’s reversal.
Looking at gold’s performance relative to other commodities, it certainly has been doing its own thing lately. Year to date, both gold ETFs are up over 25% and finished the week more than 8% above their 50-day moving average after pulling back from extreme overbought levels. Most other commodity-related ETFs are either down or up by mid-single-digit percentages. Gold has its reasons to rally relative to other commodities, but as it rallied above $3,500 last week, its price became extremely extended.
Apr 25, 2025
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“I always tell the truth. Even when I lie.” – Al Pacino
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
To view yesterday’s interview on CNN’s OutFront, click on the image below.
After three strong days for stocks following the plunge to start the week, the week looks to be ending on a down note following the publication of an interview by Time magazine with President Trump. The interview took place on Tuesday, so the comments are for intents past their shelf life based on the White House news cycle, but they reinforce the notion that when it comes to this Administration, policy is a moving target.
Earnings news was mixed overnight, but the most high-profile report came from Alphabet (GOOGL), and the stock is trading up in response. The only economic report on the calendar is Michigan Confidence. Investors will be watching the inflation expectations component of that report. Even as it has become incredibly polarized based on political leanings, the general trend has been higher, which the Fed doesn’t want to see.
Day-to-day volatility in the market has picked up since late February, and the historic 9.5% rally from April 9th sticks out like a big middle finger. That big gain also overshadows a nearly impressive run of three straight daily gains of 1.5% or more in the S&P 500. Outside of the big gain on 4/9, any of these days would have qualified as among the best days in the last six months, but having them occur on a back-to-back-to-back basis is extraordinary.
As impressive as the daily gains have been, yesterday’s rally only took the S&P 500 back to levels it opened at right after the Liberation Day ceremony in the Rose Garden and then the level it traded up to on 4/9. For bulls to breathe easier, we’ll need to see the market maintain its momentum and break above this resistance, which happens to coincide with the downtrend line from the February high.
Apr 24, 2025
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“The lack of a sense of history is the damnation of the modern world.” – Robert Penn Warren
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
After two days of solid gains, US equity futures are lower this morning but off their lows as the S&P 500 is indicated to open down 0.31%. After the last several trading days, though, investors could probably use a breather, as four of the last five trading days have seen gains or losses of at least 1.5%. Overnight, Asian stocks were mixed but mostly higher, even as the Chinese government pushed back on claims from the US Administration that the two sides are talking to de-escalate the trade war between the world’s two largest economies. In Europe, equities are seeing very modest losses.
Outside of equities, Treasury yields are lower with the 10-year trading down to 4.34%, oil is 1% higher, gold is rebounding after Wednesday’s sharp decline, and Bitcoin is down 1% but still over $92K.
Earnings news since yesterday’s close has generally been positive, but a negative reaction to IBM’s results has the stock trading down 7%, which is contributing to a more than 100-point decline in the Dow.
On the economic calendar, we’ll get Durable Goods Orders and Jobless Claims 8:30, followed by Existing Home Sales at 10 and the KC Fed regional manufacturing report at 11. Of these reports, jobless claims will be the most important to watch for any signs of weakness due to the impact of tariffs.
While the last two trading days have been strong for US stocks, performance over the last five trading days has been weak, lagging the rest of the world. As shown in the snapshot below, the SPDR S&P 500 ETF (SPY) is down 0.41% over the last five trading days, which keeps it over 5% below its 50-day moving average (DMA) and down over 8% for the year. Relative to other regional international ETFs, SPY is the only one down YTD, and along with Emerging Markets (EEM), the only one below its 50-DMA as well.
The weakness in US stocks has been extremely evident in investor sentiment. This week’s survey from the American Association of Individual Investors (AAII) showed that bearish sentiment declined from 56.9% to 55.6%, but that still extends the streak of readings where bears were at 50% or more to a record nine weeks. In the entire history of the survey dating back to 1987, there have only been three other periods where bears were at 50% or more of total respondents for even five straight weeks.
Apr 23, 2025
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“There is nothing either good or bad, but thinking makes it so.” – William Shakespeare, Hamlet
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
It’s been quite a week for equity markets, and Wednesday hasn’t even started yet! After a 2%+ decline on Monday, the S&P 500 rebounded more than 2% yesterday, and after some less confrontational comments from President Trump after the close yesterday related to Powell and China, futures are up another 2%+ in the pre-market! Even US treasuries are rallying. And gold is down!
One comment from the President that encouraged markets was when he said that the 145% tariff on Chinese imports were “very high, and it won’t be that high. … No, it won’t be anywhere near that high. It’ll come down substantially. But it won’t be zero.” That’s encouraging, although at 145%, there a lot of room for tariff rates to come down significantly and still be incredibly high! 70% is less than half of 145%, but that would still be a crushing rate. Remember, back on April 2nd, the President thought he was going easy on countries with the rate of reciprocal tariffs. We’ll see how this all plays out, but until the next headline comes out that contradicts yesterday’s, markets can rally.
The pace of earnings news has really started to pick up in the last couple of days and will only get busier in the days ahead. On the economic calendar this morning, we’ll get flash PMI readings for the Manufacturing and Services sector at 9:45, which will likely show weakness, and then New Home Sales at 10 AM.
When the market is stuck in a downtrend, one key trend to watch for signs of a reversal is when stocks stop going down on bad news. When that happens, it’s usually taken as a sign that all the bad news is finally ‘priced in’ to the market. So, while an economic or earnings report may be ‘bad news’ in terms of coming in weaker than expected, if the broader market or an individual stock rallies on it, it can actually be considered good news.
Yesterday, the market got some bad news from the IMF regarding global growth forecasts, but considering the 4%+ gain in the S&P 500 since then (including today’s move in the futures), it must have been good news, right? Obviously, there were other factors behind the rally, but it does illustrate that this ‘news’ from the IMF was already well known by the market.
For the world in general, the IMF cut its overall estimated rate of global growth down by half a percentage point. For advanced economies, the growth rate was lowered for every country and region except Spain (+0.2 ppts). The US saw the sharpest downgrade to growth forecasts (-0.9 ppts), second only to Mexico’s drop of 1.7 ppts. In emerging and developing economies, growth forecasts saw nearly across-the-board cuts. The only country where the IMF upgraded global growth forecasts was Russia. Russia!
With the new GDP growth forecasts from the IMF, global growth in 2025 is expected to be slower in most economies. Again, the US is expected to see the sharpest deceleration relative to 2024, with growth declining by a full percentage point while Japan (+0.5 ppts) and Germany (+0.2 ppts) are the only two advanced economies expected to see growth accelerate in 2025 relative to 2024. In EM and developing economies, Russia is expected to see the sharpest slowdown (-2.9 ppts), but Mexico, Brazil, Europe, and China are all expected to see sharp slowdowns in GDP growth. The only economies in this group expected to see growth acceleration are Saudi Arabia, Middle East & Central Asia, and South Africa.
As the charts above illustrate, the US has seen among the sharpest downgrades to GDP growth estimates, but among developed economies, it is still expected to show relatively strong growth (+1.8%), second only to Spain’s expected growth rate of 2.5%. So, while the IMF may be cutting the rate of US growth by more than other advanced economies, its economy is still expected to see much stronger growth than other developed economies. In EM and developing economies, however, most countries are expected to see much stronger growth, as Mexico is the only economy expected to contract. As a result of the stronger growth in emerging and developing economies, overall global growth is expected to come in at 2.8% for 2025.
Apr 22, 2025
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“I don’t wanna be a product of my environment; I want my environment to be a product of me.” – Jack Nicholson
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
After plunging to start the week yesterday, US futures are attempting to continue the late-day rebound that began in yesterday’s last hour of trading. With an indicated gain of about 0.8%, though, that would only be enough to erase a third of yesterday’s losses. With one step forward for every three steps back, it’s not an environment that leads to meaningful gains. European equities are all lower this morning after being closed for Easter yesterday, and with the STOXX 600 down only 0.70%, it’s down less since last Thursday’s close than the S&P 500.
Outside of equities, US Treasury yields are modestly lower, erasing earlier increases. Crude oil is up close to 2% and over $64 per barrel, while Bitcoin is up 1.5% and back near $89,000. Finally, the unstoppable freight train of gold is up another 1% to another record high – its 16th in the last 30 trading days!
The rise in gold prices has been nothing short of amazing, with the safe-haven asset seemingly hitting record high after record high, and today’s 1.15% advance marking yet another one. Yesterday’s 3%+ rally was the fifth time in the last ten trading days that gold rallied at least 2% in a single day. In the last 50 years, the only periods that experienced a higher frequency of 2%+ daily moves were in January and June of 1980. Since then, there have only been a handful of periods where gold experienced as many 2% daily moves in a ten-trading-day span, with the most recent occurring more than 15 years ago in September 2008. Also, keep in mind that the most recent five daily 2%+ gains occurred over an eight-trading-day span, so there are still two more trading days to increase that total!
With the high frequency of big daily gains, gold now trades more than 27% above its 200-day moving average. That’s the most extended traded relative to its 200-DMA since 2011. Like the high frequency of 2% daily moves in the 10-trading day period, there have only been a handful of other periods when gold traded more than 25% above its 200-DMA, and the most extended it ever got was an astonishing 130%+ in early 1980. To trade at similarly extreme levels now, gold would trade above $6,200 per ounce.
Apr 21, 2025
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“The world in which we live is collapsing and may be nearing the breaking point,” – Pope Francis
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
Maybe US markets should have followed the US lead and stayed closed for Easter today. US futures are sharply lower to kick off the week as investors face the uncertainty of US economic, trade, and monetary policy. There’s always uncertainty, but investors have a lot to contend with right now as there has been little evidence of progress on trade deals with the 70+ countries eager to “make a deal”, heightened concerns over the Fed’s independence, and how these policies will impact the economy. And, oh yeah, we’re just getting into the peak of earnings season.
Outside of the equity market, long-term treasury yields are modestly higher, the dollar is lower, and gold is surging. Even Bitcoin is starting to show signs of life as dollar weakness becomes more ingrained into global markets.
It may have been a short week, but US stocks still found a way to fall last week, with the S&P 500 dropping 1.5%. While the index declined, five sectors finished the week higher, and only three – Technology, Consumer Discretionary, and Communication Services – underperformed the S&P 500. Overall, the eleven S&P 500 sectors had an average change of 0.00%, which was much better than the index itself.
Since 1990, it hasn’t been particularly common to see such a wide disparity between the weekly performance of the S&P 500 and the average performance of its sectors. Last week was just the 19th time that the S&P 500 fell more than 1%, and the average sector’s performance was either positive or less than a decline of 0.5%. In the chart below of the S&P 500, we have included a red dot to indicate each occurrence.
From 1990 through 1998, there was never a single weekly occurrence, but from 1999 through 2000, there were eight separate occurrences. Since then, the occurrences have been relatively spread out, the most recent being in March and April 2022. The fact that most of the prior occurrences came in 1999, 2000, and 2022 can be explained by the fact that those were other periods where there was a high level of concentration in the market, and more specifically in the Technology sector. When one sector has such a large weight in the overall index, it creates a backdrop where one sector can have a big impact on the index itself, even as other sectors hold up relatively well.
