Rollercoaster Ride
May 1, 2025 at 12:22 pm Leave a comment
Remember Liberation Day – the day reciprocal tariffs were announced? For those of us strapped daily into the financial market seat, it has felt like an endless rollercoaster ride since that eventful day. It may not seem like it, but reciprocal tariffs were unveiled a mere four weeks ago. Initially, after the April 2nd announcement, the stock market experienced a scary free fall. Then, after President Trump proclaimed a 90-day pause on the reciprocal tariffs and walked back other tariffs with exemptions, stock prices reversed course and catapulted higher to finish the month almost flat.
More specifically, the S&P 500 index slipped -0.8%, the NASDAQ index climbed +0.9% and the Dow Jones Industrial Average fell -3.2% in April.
Although the S&P 500 was temporarily down -21% from the February peak, the index has now bounced back and is down only -5% for the year (see chart below). Worries about a recession and tariff-induced inflation have not disappeared, but corporate profits remain strong, and we will get a fresh picture of the labor market on Friday when the monthly employment figures are released. If investors obtain some tariff clarity, trade deal announcements, and/or tax-cut legislation progress, the queasy stock market rollercoaster ride could turn to smooth sailing.
Wade W. Slome, CFA, CFP®
Plan. Invest. Prosper.
This article is an excerpt from a previously released Sidoxia Capital Management complimentary newsletter (May 1, 2025). Subscribe Here to view all monthly articles.
DISCLOSURE: Sidoxia Capital Management (SCM) and some of its clients hold positions in certain exchange traded funds (ETFs), but at the time of publishing had no direct position in any other security referenced in this article. No information accessed through the Investing Caffeine (IC) website constitutes investment, financial, legal, tax or other advice nor is to be relied on in making an investment or other decision. Please read disclosure language on the IC Contact page.
Entry filed under: economy, Education, Financial Markets, Government, Stocks. Tags: bonds, economy, interest rates, investing, Politics, Sidoxia, stock market, Stocks, tariffs, Wade Slome.
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