Weekly Market Commentary April 21, 2025

U.S. equities experienced a downturn last week, reversing the sharp gains from the previous week. Both the S&P 500 and Nasdaq indices have now fallen for the third time in the last four weeks. Treasuries strengthened, leading to a steepening of the yield curve. For the week ending, April 18:

• The S&P 500 declined by -1.50%

• The Dow Jones Industrial Average fell by -2.66%

• The tech-heavy Nasdaq dropped by -2.62%

• The yield on the 10-Year Treasury rose to 4.34%, up from 4.10% at the end of the previous week

Due to the observance of Good Friday, this week had fewer economic data releases.

On Wednesday, retail sales data revealed a significant 1.4% increase in U.S. retail sales for March. This surge is largely due to consumers rushing to purchase vehicles before the 25% global car and truck tariffs took effect in early April. This follows a modest 0.2% rise in February. However, economic concerns are impacting discretionary spending, with high-income households continuing to drive spending while low-income consumers struggle.

The Federal Reserve delivered a speech on April 16, highlighting the potential for future interest rate adjustments and ongoing volatility in the bond market. Investors are closely monitoring U.S. Treasury yields, which have experienced increased volatility in recent weeks. The Fed's comments have heightened speculation about the direction of monetary policy, contributing to market uncertainty and affecting global financial markets.

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