The recent volatility in the stock market has once again highlighted the close relationship between Wall Street and the White House. Last week, we saw how the market reacted to President Donald Trump’s comments and actions, with the S & P 500 experiencing significant swings throughout the week.
The week started off on a negative note, with the S & P 500 dropping more than 2% as President Trump criticized Federal Reserve Chairman Jerome Powell and provided little clarity on tariff negotiations. However, things started to turn around on Tuesday when Treasury Secretary Scott Bessent hinted at a potential de-escalation in the trade war with China. This news sparked a three-session rally for the S & P 500, with gains continuing through Wednesday and Thursday.
By the end of the week, the S & P 500 and the Nasdaq had both posted strong gains, with the Nasdaq leading the way with a 6.7% increase. Tech stocks like Broadcom and CrowdStrike were among the top performers, while sectors like health care and materials continued to struggle.
Earnings reports from consumer-facing companies also painted a grim picture of the economy, with concerns about inflation and consumer spending weighing on sentiment. However, some companies like Capital One saw strong performance, with their stock price soaring more than 12% for the week.
In terms of trading activity, we made several moves last week based on market conditions and expert advice. We lightened our positions in Apple and Nvidia, given the uncertainty surrounding U.S.-China tensions. We also added to our holdings in Capital One, BlackRock, and Dover before they saw significant gains.
Looking ahead, the economic calendar is packed with key data releases that could impact the market. Job reports, inflation data, and earnings reports from major companies like Visa, Caterpillar, and Mastercard will be closely watched. These reports will provide insights into the state of the economy and the potential impact of ongoing trade tensions.
Overall, the stock market remains closely tied to political developments and economic indicators. Investors will need to stay vigilant and adapt their strategies to navigate the volatility and uncertainty in the market.
