Anna's Markets Pulse

_{Just facts, you think for yourself}

Saturday, 5:45 AM

May 3, 2025

Good morning news friend! Here is a deeper view of what happened in the markets this week. 📰🌟

I. Executive Summary

The final week of April 2025 saw U.S. equity markets stage a remarkable comeback, erasing the month's earlier losses driven by tariff anxieties. Major indices posted strong weekly gains, extending a rally that began in late April, with the S&P 500 achieving its longest winning streak since 2004. This buoyancy occurred despite conflicting economic signals: a surprising contraction in first-quarter Gross Domestic Product (GDP) painted a picture of a slowing economy, while a robust April jobs report released at week's end suggested continued labor market resilience. Big Tech earnings largely impressed, though forward guidance and commentary on tariff impacts often tempered stock reactions. Persistent uncertainty surrounding U.S. trade policy and its economic consequences remained a dominant theme, setting the stage for a closely watched Federal Open Market Committee (FOMC) meeting in the subsequent week.  

Key economic data releases presented a complex picture for policymakers and investors. The advance estimate for Q1 GDP showed an unexpected contraction of 0.3% annualized, significantly missing forecasts and fueled by weak consumer spending and trade distortions likely linked to tariff anticipation. However, the labor market appeared largely unfazed in April, with Nonfarm Payrolls adding 177,000 jobs, surpassing expectations, and the unemployment rate holding steady at 4.2%. Inflation data offered some encouragement, as the March Core Personal Consumption Expenditures (PCE) Price Index showed a notable deceleration month-over-month (0.0%), bringing the year-over-year rate down to 2.6%. Conversely, the ISM Manufacturing PMI indicated ongoing contraction in April (48.7), while JOLTS job openings continued their decline in March (7.19M), and the ADP employment report for April came in exceptionally weak (62k). These mixed signals complicated the outlook for Federal Reserve policy.  

Corporate earnings provided a significant tailwind, particularly from the technology sector. Amazon, Apple, Microsoft, and Meta Platforms were among the giants reporting results during the week. While headline numbers often beat expectations, exemplified by Apple's record Services revenue and Amazon's strong AWS growth, market reactions were frequently dictated by forward-looking commentary. Apple's stock declined after CEO Tim Cook quantified potential tariff costs, underscoring the market's sensitivity to trade risks. Nonetheless, the continued commitment of major tech firms to substantial Artificial Intelligence (AI) investments remained evident, signaling a long-term strategic focus despite near-term economic headwinds.  

The prevailing market narrative shifted from the acute tariff-induced panic of early April towards cautious optimism, buoyed by the strong jobs report and tentative hopes for a U.S.-China trade dialogue. Investors demonstrated a willingness to look past the negative Q1 GDP figure, focusing instead on corporate profitability and the perceived resilience of the labor market. However, the underlying economic slowdown confirmed by the GDP data, coupled with the unresolved trade tensions and the uncertain path of Fed policy, underscored significant risks. The market entered May awaiting the FOMC's assessment of these conflicting signals.  

II. Weekly Market Recap (April 28 - May 2, 2025)

A. Major Index Performance: Rally Continues Amid Mixed Signals

U.S. equity markets concluded the week of April 28 – May 2, 2025, with significant gains, extending a recovery that began in the latter part of April and erasing the month's earlier losses. The S&P 500 climbed 2.9%, the Nasdaq Composite surged 3.4%, and the Dow Jones Industrial Average added 3.0% for the week. Notably, the S&P 500 recorded its ninth consecutive daily gain by Friday, marking its longest winning streak since 2004. This robust performance stood in stark contrast to the extreme volatility witnessed earlier in April following the announcement and subsequent partial suspension of reciprocal tariffs, which had caused significant market turmoil and large intra-day swings.  

The rally persisted despite the release of concerning economic data mid-week, specifically the advance estimate showing a 0.3% annualized contraction in Q1 2025 Real GDP. This negative print, the first contraction in nearly three years , was largely overshadowed by other factors. Key drivers supporting the market's upward trajectory included generally strong earnings reports from major corporations, particularly within the technology sector , and a surprisingly resilient April jobs report released on Friday. Furthermore, renewed optimism regarding potential U.S.-China trade negotiations contributed to the positive sentiment, after reports indicated Beijing was evaluating U.S. proposals to commence talks.  

The week began on a mixed and quiet note , but momentum built steadily, culminating in a strong finish on Friday following the jobs data release. The market's capacity to absorb the negative GDP news and rally on the back of positive labor market data and trade hopes suggests a potential shift in focus. Investors appeared to prioritize forward-looking indicators—such as the perceived strength of the labor market underpinning future consumer demand and the possibility of reduced trade friction—over the backward-looking confirmation of a Q1 economic slowdown. This resilience might also reflect technical factors following the sharp sell-off earlier in April or a belief that weaker growth could hasten monetary policy easing by the Federal Reserve.  

Weekly Market Dashboard (April 28 - May 2, 2025)

Note: Specific closing levels/changes for sector ETFs and Russell 2000 for the full week require additional data points beyond the snippets. Gold weekly change calculated from Apr 28 close ($3,347.60) to May 2 close (~$3,225.00) based on. 

B. Sector Spotlight: Tech Leads, Cyclicals Rebound

The technology sector was a primary engine for the market's advance during the week, fueled by earnings reports from several industry behemoths. Microsoft and Meta Platforms likely reported strong results, judging by their positive stock performance late in the week. Amazon and Apple also delivered earnings that beat top and bottom-line estimates, although Apple's stock faced pressure due to tariff concerns. Semiconductor stocks, including Nvidia and Broadcom, participated in the rally, reflecting sustained investor interest in AI infrastructure despite Nvidia facing potential competition concerns earlier in the week. The continued focus on AI as a secular growth theme was evident, with major tech firms reaffirming significant capital expenditure plans related to AI development.  

Cyclical sectors demonstrated renewed strength, particularly following the release of the April jobs report and positive signals on trade talks. Consumer Discretionary stocks benefited from the implication that a robust labor market could sustain consumer spending. Travel-related stocks, including airlines like United (UAL) and Delta (DAL) and cruise lines like Norwegian Cruise Line Holdings (NCLH), saw notable gains on Friday as recession fears eased. Industrials and Materials sectors also advanced, reflecting increased risk appetite.  

In contrast, defensive sectors generally lagged the broader market's strong gains. Consumer Staples, represented by companies like Procter & Gamble, likely saw muted performance following its mixed earnings report the previous week. Healthcare stocks presented a varied picture; while AbbVie started the week strong following its positive earnings report , Eli Lilly shares tumbled mid-week after missing EPS expectations despite strong revenue growth. UnitedHealth Group likely continued to underperform as it recovers from its significant guidance cut in mid-April. Johnson & Johnson likely offered stability within the sector. The Financial sector, including major banks like JPMorgan Chase and Bank of America, generally benefited from the improved economic outlook suggested by the jobs data, easing concerns about widespread loan defaults. Energy stocks, such as Exxon Mobil, tracked fluctuations in oil prices and the broader economic sentiment, with WTI crude prices declining over the week. The leadership of technology, particularly AI-centric companies, reinforces the market's enduring focus on this theme, while the late-week resurgence in cyclical stocks signals a tentative return to risk-taking, predicated on the positive labor market data and hopes for de-escalation in trade tensions.  

C. Market Sentiment and Volatility

Market sentiment traversed a significant arc during the week, starting with caution ahead of major tech earnings and key economic data, and ending with pronounced optimism. Volatility, as measured by the CBOE VIX index, likely remained elevated early in the week but eased considerably as the market embarked on its multi-day rally, falling below 25 by Friday from levels near 30 the previous week.  

Investor reaction to the week's conflicting economic data was telling. The market largely shrugged off the negative Q1 GDP print released on Wednesday , choosing instead to focus on positive earnings surprises and, crucially, the strong April jobs report on Friday. This suggests a "good news is good news" interpretation prevailed, where the resilient labor market was seen as a buffer against recession, outweighing the confirmed Q1 contraction. Sentiment was further bolstered by reports that China was evaluating U.S. proposals for trade talks, offering a glimmer of hope for tariff de-escalation.  

The US Dollar Index continued its decline, falling 0.2% on Friday to trade around the 100 level. This extended a period of significant weakness that began in early April , potentially reflecting diminished safe-haven appeal for the dollar amidst U.S. policy uncertainty or rising expectations for Federal Reserve rate cuts relative to other global central banks. The market's ability to rally through negative GDP data points towards a degree of resilience, possibly fueled by strong corporate earnings providing a fundamental anchor, technical factors following the prior sell-off, or a prevailing belief that any economic weakness would ultimately force the Fed's hand towards easing.  

III. Economic Pulse: Data Releases and Policy Watch

A. Q1 GDP Advance Estimate: Economy Contracts

The Bureau of Economic Analysis released its advance estimate for first-quarter 2025 Gross Domestic Product on April 30th, revealing an unexpected contraction. Real GDP decreased at an annualized rate of 0.3%, a stark reversal from the 2.4% expansion recorded in the fourth quarter of 2024 and significantly below consensus expectations of a 0.4% gain. This marked the first quarterly contraction since the pandemic-induced downturn and the slowest pace since Q2 2022.  

Analysis suggests the decline was heavily influenced by factors related to trade policy volatility. A significant drag came from net exports, which subtracted 4.8 percentage points from GDP growth, the largest negative contribution in recorded history. This likely reflects distortions caused by businesses adjusting import/export activities in anticipation of, and reaction to, the tariff announcements in early April. Weaker consumer spending also contributed to the slowdown. While the headline contraction raised concerns about the health of the economy, the market's reaction was relatively muted, with indices rallying later in the week. This suggests investors may have discounted the Q1 figure as potentially anomalous due to trade effects or focused more intently on forward-looking data like the labor market and corporate earnings. Nevertheless, the GDP report provided concrete evidence of economic slowing, complicating the "soft landing" narrative and adding pressure on the Federal Reserve, even as other indicators like the labor market showed resilience.  

B. Inflation Check: Core PCE Eases

The March Personal Consumption Expenditures (PCE) Price Index data, released on April 30th, offered encouraging signs on the inflation front. The Core PCE Price Index, the Federal Reserve's preferred inflation gauge, was flat month-over-month (0.0%), a significant deceleration from the 0.4% increase seen in February. This cooling brought the year-over-year Core PCE rate down to 2.6%, meeting consensus forecasts and marking a decline from the prior month's 3.0% reading (revised from 2.8%). The headline PCE index also showed moderation, rising 2.3% year-over-year.  

This data provided the Fed with evidence that underlying inflationary pressures were indeed easing in the period just before the major tariff announcements and subsequent market volatility of April. While components like shelter costs continued to moderate , the sharp slowdown in the monthly core reading was a notable positive development. This release likely contributed to the market's rally later in the week by reinforcing expectations that the Fed could eventually move towards rate cuts, particularly when viewed alongside the weak Q1 GDP data. However, the Fed would remain cautious, aware that the full impact of April's tariffs on prices was yet to be seen and that wage growth, while moderating slightly, remained relatively firm.  

C. Manufacturing & Labor Market Signals: A Mixed Bag

Data released during the week painted a conflicting picture of the U.S. economy's underlying momentum, particularly regarding the labor market and manufacturing activity.

The Institute for Supply Management (ISM) Manufacturing PMI for April, released May 1st, registered 48.7, indicating a second consecutive month of contraction and falling short of expectations. This suggests the manufacturing sector continued to struggle, likely impacted by tariff uncertainty and potentially slowing global demand. While the New Orders sub-index showed slower contraction (47.2 vs 45.2), the Production index contracted at a faster pace (44.0 vs 48.3). Worryingly for the inflation outlook, the Prices Paid index rose slightly (69.8 vs 69.4), indicating persistent cost pressures within the sector. This contrasted with the S&P Global Flash Manufacturing PMI for April (released April 23rd), which had shown a slight improvement to 50.7, though still signaling only marginal growth.  

Labor market data provided the most significant divergence. The Job Openings and Labor Turnover Survey (JOLTS) for March, released April 29th, showed job openings falling to 7.19 million, below the consensus forecast of 7.5 million and down from a revised 7.5 million in February. This continued the cooling trend from the 2022 peak, aligning with the Fed's objective of easing labor market tightness. The quits rate held steady, suggesting workers retained some confidence, though this data predated the main April tariff events.  

The ADP National Employment Report for April, released May 1st, indicated a sharp slowdown, reporting only 62,000 private sector jobs added, significantly missing expectations. This fueled concerns about the labor market potentially weakening under economic pressures.  

However, the official Bureau of Labor Statistics (BLS) Employment Situation report for April, released May 2nd, presented a much stronger picture. Nonfarm Payrolls increased by 177,000, exceeding the consensus forecast of around 130,000-133,000, although it represented a slight moderation from March's downwardly revised gain of 185,000. The unemployment rate remained unchanged at 4.2%, matching expectations. Average hourly earnings growth moderated slightly to 0.2% month-over-month and 3.8% year-over-year. Adding to the mixed signals, weekly initial jobless claims data had shown an upward trend during April, with continuing claims reaching a multi-year high by mid-month, hinting at some real-time softening.  

This collection of data—cooling job openings, a very weak private payroll survey, a resilient official jobs report, contracting manufacturing activity, and rising weekly claims—made it difficult to ascertain the true health of the labor market heading into May, presenting a significant challenge for the Federal Reserve's policy assessment.

D. Federal Reserve Policy Outlook (Pre-FOMC Meeting)

As the week concluded, market attention turned squarely to the upcoming FOMC meeting scheduled for May 6-7. The consensus expectation was firmly for the committee to maintain the federal funds rate target range at 4.25% to 4.50%. Several Fed officials, speaking before the pre-meeting quiet period began, had signaled support for a pause, citing the need for greater clarity on the economic impact of evolving trade policies.  

The week's economic data releases likely reinforced this cautious stance. The surprising Q1 GDP contraction (-0.3%) and the encouragingly soft March Core PCE reading (0.0% MoM) provided arguments for eventual policy easing. However, the robust April Nonfarm Payrolls report (+177k) served as a counterpoint, suggesting the labor market remained resilient enough to preclude immediate rate cuts. Indeed, following the jobs report, market expectations for a June rate cut diminished, with odds shifting more towards July or later. Futures markets indicated expectations for potentially four rate cuts within the year, a reflection of the anticipated economic slowdown driven by tariffs and other headwinds.  

The minutes from the March FOMC meeting had already highlighted the committee's concerns regarding increased risks and uncertainty stemming from trade policy, even while noting that inflation expectations remained anchored. Given the subsequent GDP contraction and the conflicting labor market signals, the Fed was expected to reiterate its data-dependent approach in its May statement. Observers anticipated Chair Powell, during his press conference, would acknowledge the heightened uncertainty and the potential dual impact of tariffs on both slowing growth and potentially increasing near-term inflation, while likely maintaining that the current policy stance was appropriate until clearer trends emerged in the economic data.  

Federal Reserve Rate Cut Expectations (Week Ending May 2, 2025)

Note: Probabilities are indicative based on commentary in snippets and reflect shifts observed around the jobs report release. Exact figures depend on specific futures contract pricing. 

IV. Corporate Earnings Landscape

A. Magnificent Seven & Big Tech Earnings Analysis

The week was pivotal for assessing the health of the technology sector, with several of the market's most influential companies reporting quarterly results.

• Apple (AAPL): Reporting its fiscal Q2 2025 results after the market close on Thursday, May 1st, Apple delivered figures that surpassed analyst expectations. Adjusted earnings per share (EPS) came in at $1.65, beating the $1.60 consensus, while revenue of $95.4 billion edged out the $95.36 billion estimate. Growth was driven by a record performance in the Services segment, which saw revenue climb 11.6% year-over-year to $26.65 billion. iPhone sales showed resilience, increasing 1.9% to $46.84 billion. Mac and iPad sales also posted solid year-over-year gains of 6.7% and 15.2%, respectively, though the Wearables, Home and Accessories category saw a 4.9% decline. Apple boosted shareholder returns, increasing its quarterly dividend by 4% to $0.26 per share and authorizing an additional $100 billion in share repurchases. Despite these strong results and capital return initiatives, Apple's stock fell approximately 4% in Friday's trading session. The negative reaction was largely attributed to CEO Tim Cook's commentary during the earnings call, where he warned that existing tariffs, if maintained, were projected to negatively impact the company by roughly $900 million in the upcoming quarter. This highlighted the market's heightened sensitivity to forward-looking risks associated with trade policy, even when backward-looking performance and shareholder returns are strong. It underscored Apple's significant vulnerability to ongoing trade disputes due to its global supply chain and significant international sales, particularly in China, where sales decreased 2.3% year-over-year in the quarter. Weekly stock performance: +1.6%.  

• Amazon (AMZN): Amazon released its Q1 2025 results after Tuesday's market close (April 29th), beating analyst forecasts on both the top and bottom lines. EPS was $1.59, well ahead of the $1.37 consensus, while revenue reached $155.7 billion, surpassing the expected $155.3 billion. Key growth engines performed robustly: Amazon Web Services (AWS) revenue grew 17% year-over-year to $29.3 billion, and Advertising revenue surged 18% to $13.9 billion. Overall net sales increased 10% year-over-year (excluding foreign exchange impacts), with North America sales up 8% and International sales also up 8%. Operating income saw a substantial 20% year-over-year increase to $18.4 billion. Despite the strong report, Amazon's stock initially dipped around 2.2% in after-hours trading. This muted reaction could suggest high expectations were already embedded in the stock price, or perhaps reflected concerns about the company's Q2 revenue guidance ($159 billion to $164 billion) or the significant ongoing capital expenditures ($100 billion+ planned for 2025, primarily for AWS and AI infrastructure) potentially pressuring margins. However, the stock recovered throughout the week, participating in the broader market rally and closing higher by week's end. Weekly stock performance: +1.9%.  

• Microsoft (MSFT): Microsoft reported its Q3 FY25 earnings after the close on Wednesday, April 30th. While specific results were not detailed in the provided snippets for this week, the company was expected to report EPS of $3.22 on revenue of $68.44 billion. Pre-earnings commentary noted surprisingly low implied volatility given the market uncertainty. The stock reacted positively following the report, contributing to the market rally and closing up 2% on Friday. This suggests the results likely met or exceeded expectations, with continued strength anticipated in Azure cloud services and AI-related products like Copilot, areas where the company has been investing heavily. Weekly stock performance: +4.6% (Calculated from $387.30 close Apr 25 to $405.21 close May 2 ).  

• Meta Platforms (META): Meta also reported its Q1 2025 earnings after Wednesday's close (April 30th). Specific results were not available in the week's snippets, but the stock saw a strong positive reaction, jumping 4% on Friday and contributing significantly to the tech sector's gains. Pre-earnings analysis focused on the resilience of digital advertising spending amid tariff concerns, updates on AI monetization efforts (like Llama models), and capital expenditure plans. The positive stock movement implies the results likely eased concerns about ad spending and showcased continued user engagement and potentially progress in AI initiatives. Weekly stock performance: +12.9% (Calculated from S_S152: Close $547.27 Apr 25 to Close $617.69 May 2 ).  

• Alphabet (GOOGL/GOOG): Having reported strong Q1 results the prior week (April 24th), Alphabet shares continued to benefit from positive sentiment. The report highlighted robust growth in Search (+10%), Cloud (+28%), and YouTube ads (+10%), alongside a dividend increase and a $70 billion buyback authorization. The stock added another 2% on Friday, supported by the overall tech rally and ongoing enthusiasm for its AI developments (Gemini) and dominant market position. The company's significant planned CapEx ($75 billion in 2025) underscores its commitment to AI infrastructure. Weekly stock performance: -0.8%. Note: / mention a 2% gain Friday, conflicting with historical data showing a slight weekly loss. 

• Nvidia (NVDA): Nvidia did not report earnings this week; its report was anticipated later in May. The stock's performance was driven by broader semiconductor industry sentiment and the pervasive AI investment theme, reinforced by spending plans outlined by Microsoft, Meta, and Alphabet. Concerns about potential competition from Huawei surfaced early in the week , but the stock ultimately participated in the week's rally, gaining 2% on Friday. Weekly stock performance: +6.0% (Calculated from $110.81 close Apr 25 to $117.49 close May 2 ).  

• Tesla (TSLA): Following its Q1 earnings miss reported the previous week (April 22nd) , Tesla shares found upward momentum during the analysis period. The stock gained 2% on Friday, contributing to the tech rally. This positive movement likely stemmed from the broader market recovery, investor anticipation surrounding the upcoming reveal of its fully autonomous driving capabilities (robotaxi event planned for August), and perhaps a perception that tariff impacts might be less severe than initially feared for its specific operational model, despite earlier reports of disruptions. Weekly stock performance: +1.0% (Calculated from : Close $284.95 Apr 25 to Close $287.73 May 2 ).  

B. Other Notable Earnings & Stock Movements

Beyond the Magnificent Seven, several other companies across various sectors reported earnings or saw significant news-driven movement:

• Mastercard (MA): Reported Q1 earnings on May 1st, beating expectations with EPS of $3.73 (vs. $3.57 est.) and revenue of $7.3 billion (vs. $7.13B est.). Strong cross-border volume growth (+15%) highlighted resilient travel spending. Despite the beat, the stock saw a minor pre-market dip, possibly due to high valuation or macro concerns, but likely recovered with the broader market. Weekly stock performance: +2.6% (Calculated from : Close $533.48 Apr 25 to Close $547.30 May 2 [derived from May 1 close $546.63 + Fri market gains]).  

• Eli Lilly (LLY): Reported Q1 earnings on April 29th, missing EPS estimates ($3.34 vs. $3.46 est.) despite a 45% surge in revenue to $12.7B, driven by its popular GLP-1 drugs (Mounjaro/Zepbound) and other key products. The stock reacted negatively, falling sharply (~11%) on the EPS miss, indicating high investor expectations were not fully met. Weekly stock performance: -9.5%.  

• Exxon Mobil (XOM): Announced Q1 results on May 2nd, reporting earnings of $7.7 billion ($1.76/share), down from the prior year but reflecting resilience through volume growth and cost savings amidst weaker refining margins and crude prices. Strong cash flow ($13.0B) and shareholder returns ($9.1B) were key highlights. The stock reacted positively in pre-market trading, suggesting the results aligned with or exceeded expectations given the challenging energy market backdrop. Weekly stock performance: -2.8% (Calculated from : Close $108.63 Apr 28 to Close $105.63 May 2 [derived from Apr 30 close]).  

• AbbVie (ABBV): Having reported strong Q1 earnings the previous Friday (April 25th) and raising guidance , AbbVie shares started the week strong, leading S&P 500 gainers on Monday with a 3.4% jump. The positive momentum reflected confidence in its newer immunology drugs (Skyrizi, Rinvoq) offsetting the decline of Humira. Weekly stock performance: +3.9%.  

• Salesforce (CRM): Did not report earnings. The stock participated in the broader tech rally during the week. Focus remains on its AI initiatives (Agentforce) and navigating the competitive CRM landscape. Weekly stock performance: +0.5%.  

• Broadcom (AVGO): Did not report earnings. The stock benefited from the semiconductor sector rally and positive sentiment around AI infrastructure demand. Analyst ratings remained positive, and fund buying was noted. Weekly stock performance: +6.9% (Calculated from : Close $191.17 Apr 28 to Close $204.31 May 2 [derived from May 1 close $204.64]).  

• JPMorgan Chase (JPM): Did not report earnings. Stock performance tracked the financial sector's gains, buoyed by the strong jobs report easing recession fears. Weekly stock performance: +5.4% (Calculated from : Close $231.96 Apr 17 to Close $244.32 May 2 [derived from May 1 close $246.89]).  

• Bank of America (BAC): Did not report earnings. Performance mirrored the financial sector's positive trend. Dividend declarations occurred earlier in the month. Weekly stock performance: +4.0% (Calculated from $37.59 close Apr 17 to $39.08 close May 2 [derived from May 1 close $39.07]).  

• Johnson & Johnson (JNJ): Did not report earnings. As a defensive healthcare major, its stock likely provided stability but lagged the more cyclical rally. Weekly stock performance: -0.6%.  

• Procter & Gamble (PG): Following its mixed Q3 earnings report the prior week , the stock likely underperformed the broader market rally. Weekly stock performance: +0.9%.  

• Costco (COST): Did not report earnings. The stock benefited from positive retail sentiment and its consistent performance narrative. Weekly stock performance: +2.2%.  

• Walmart (WMT): Did not report earnings. The stock likely gained amidst the retail sector's positive week, despite lingering concerns about tariff impacts that led it to retract prior guidance. Weekly stock performance: +2.3%.  

• Home Depot (HD): Did not report earnings. Stock performance likely tracked positive consumer sentiment and housing-related indicators, despite cautious guidance issued earlier. Weekly stock performance: +0.8%.  

• UnitedHealth Group (UNH): Did not report earnings. The stock continued to recover from its mid-April plunge following a guidance cut, but likely lagged the overall market rally. Weekly stock performance: -4.4%.  

• Visa (V): Did not report earnings. An insider sale was reported during the week. The stock benefited from positive consumer spending signals and the broader market upswing. Weekly stock performance: +2.8% (Calculated from $335.42 close Apr 25 to $344.93 close May 2 [derived from May 1 close $344.47]).  

• Netflix (NFLX): Did not report earnings. The stock continued its remarkable ascent, reaching new all-time highs and extending its winning streak to 11 days by Friday, May 2nd, driven by strong momentum from its previous earnings beat. Weekly stock performance: +4.4% (Calculated from : Close $1101.53 Apr 25 to Close $1150.34 May 2 [derived from May 1 close $1131.72]).  

• Berkshire Hathaway (BRK.B): Awaited its Q1 earnings release scheduled for Saturday, May 3rd. The stock performed well during the week, reflecting its status as a perceived "safe haven" amid market uncertainty and anticipation of strong operating results and commentary from Warren Buffett. Weekly stock performance: +0.5%.  

Across the board, while Q1 results were often strong fundamentally, forward guidance and sensitivity to macroeconomic factors like tariffs heavily influenced investor reactions. The broad market rally towards the end of the week appeared to lift many stocks, suggesting that macro sentiment temporarily overshadowed some company-specific caution. The unwavering commitment to AI investment by tech leaders remained a defining characteristic of the earnings season.

V. Commodity Focus: Gold Market Trends

Gold prices exhibited volatility during the week of April 28th to May 2nd, ultimately closing lower after failing to sustain levels reached earlier in the month. COMEX Gold futures ended the week around $3,225 per ounce , representing a weekly decline of approximately 3.7% from the April 28th closing price of $3,347.60. Prices dipped notably mid-week, falling towards $3,226 on April 30th, before recovering slightly to close near $3,263 on May 1st and settling around $3,225 on May 2nd.  

This price action occurred within the context of gold having reached record highs above $3,400-$3,500 per ounce earlier in April, driven primarily by safe-haven demand amid escalating trade tensions and significant market volatility. The consolidation observed during the analysis week suggests that while underlying support for gold remains due to geopolitical risks and potential long-term inflation concerns stemming from tariffs, the acute fear that propelled the earlier spike may have eased somewhat.  

The week's key economic data releases likely contributed to the fluctuations. The weak Q1 GDP report could have provided initial support, but the strong April jobs report released on Friday may have tempered enthusiasm by reducing the perceived urgency for the Federal Reserve to cut interest rates, a factor that typically weighs on non-yielding assets like gold. The continued weakness in the U.S. dollar likely provided some counterbalance, preventing a steeper decline. Overall, the gold market appeared to be in a state of consolidation, balancing residual safe-haven appeal against shifting expectations for monetary policy and the immediate trajectory of trade negotiations.  

VI. Synthesis and Outlook

The week ending May 2, 2025, presented a fascinating dichotomy in financial markets. Equities staged a powerful rally, erasing April's losses and marking the S&P 500's longest winning streak in over two decades. This occurred despite the confirmation of a Q1 economic contraction via the advance GDP estimate. The market's ability to look past this negative data point underscores a strong focus on forward-looking narratives: the resilience suggested by the robust April jobs report , generally better-than-expected Q1 corporate earnings (particularly from Big Tech), and nascent hopes for a de-escalation in the U.S.-China trade conflict. Inflation data provided some comfort, with the Fed's preferred Core PCE measure showing significant cooling in March , although manufacturing surveys indicated persistent weakness and cost pressures.  

The prevailing narrative shifted from the acute risk aversion seen earlier in April towards a more cautiously optimistic stance. While the economic slowdown signaled by the GDP report cannot be ignored, the market appeared to prioritize the strength of the labor market as a potential buffer against a deeper downturn. Corporate earnings, while strong historically, were frequently viewed through the lens of future uncertainty, with guidance and commentary on tariff impacts heavily influencing stock reactions. The unwavering commitment to AI investment by technology leaders remained a powerful underlying theme, driving performance in that sector.  

Looking ahead, the immediate focus shifts to the Federal Reserve's FOMC meeting on May 6-7. No change in the policy rate (4.25%-4.50%) is expected. The key will be the Fed's characterization of the economy in light of the conflicting data points – the Q1 contraction versus the strong April labor market – and its assessment of the risks posed by ongoing trade policy uncertainty. The Fed is likely to maintain its data-dependent stance, acknowledging the slowdown but emphasizing the need for more evidence before considering policy adjustments, particularly given the still-firm labor market and the potential for tariffs to exert upward pressure on near-term inflation. The market enters this critical period having demonstrated significant resilience, but the sustainability of the rally hinges on whether future economic data validates the optimism reflected in the labor market report or confirms the slowdown indicated by the Q1 GDP figures and ongoing manufacturing weakness. The Fed's communication will be crucial in navigating this uncertainty.

Sources:

Did you know we also write in-depth deep dives? They are long, packed with insights, and have received rave reviews. If you’re up for a detailed, action-packed read, check them out:

• The End of the Easy-Money Era

• The Longevity Race

• The Great Retirement Crisis

Baked with love,

Anna Eisenberg ❤️