United States
US equities closed out a volatile week with strong gains. Despite China increasing tariffs on US imports from 84% to 125%, President Trump on Friday said he remained optimistic that a trade agreement with China could still be reached.
The Dow Jones Industrial Average rose 619 points (+1.56%) to 40,212. The S&P 500 climbed 1.81% to 5,363, and the Nasdaq advanced 2.06% to 16,724. All 11 sectors of the S&P 500 finished higher, led by materials and technology. For the week, the S&P 500 posted a gain of 5.7%.
Financials outperformed, driven by JP Morgan, which rose 4% after reporting better-than-expected first-quarter earnings. CEO Jamie Dimon cautioned that markets may remain turbulent and forecast additional earnings downgrades. He noted that S&P 500 earnings estimates had already been cut by 5% during the week. Morgan Stanley also beat expectations, rising 1.44%, while BlackRock gained 2.33%, with CEO Larry Fink noted that he thought growth would slow until there is more certainty, but he did not think the US was in a financial crisis suggesting that “megatrends” in long-term growth opportunities from artificial intelligence would continue.
Technology stocks were higher, Nvidia gained 3.12%, Alphabet rose 2.59%, and Apple jumped 4.06%, closing at US$198.15.
Late on Friday, after the market had closed, President Trump announced that smartphones, computers, semiconductors, and solar cells would be excluded from the latest round of tariffs, which were otherwise set to rise to 145%. He noted the decision was made to give companies time to shift production back to the US. However, on Sunday, Commerce Secretary Lutnick clarified that some electronics, including certain smartphones and semiconductors, would face separate duties within the next two months. Trump later stated on social media that the administration is conducting a national security review of the electronics supply chain. These developments may offer short-term relief to companies like Apple and Dell that rely on Chinese imports, although ongoing uncertainty around the timing and structure of the tariffs is complicating investment decisions.
Materials stocks were also strong, with copper producer Freeport-McMoRan up 6.38% and BHP ADRs gaining 4.05%.
Bond yields moved higher, with the 10-year Treasury rising 7 basis points to 4.49% and the 2-year climbing 10 basis points to 3.96%. This pushed 30-year fixed mortgage rates to 7.1%. There was a significant bond market outflow of USD 15.64 billion for the week — the largest since December 2022. Meanwhile, the US dollar declined 1%, with the Bloomberg Dollar Index falling to 1,233 — its lowest level since October 2024.
On the economic front, the University of Michigan’s April survey showed a sharp increase in one-year inflation expectations, rising to 6.7% — the highest reading since 1981. Consumer sentiment also dropped significantly, falling from 57 to 50.8. However, there was some relief in the Producer Price Index (PPI), where the core figure — excluding food and energy — fell 0.1%, against expectations of a 0.3% increase.
Europe
European shares ended slightly lower on Friday, with the EuroStoxx 600 easing 0.10% to close at 486.80 as traders took a breather following a highly volatile week. On a weekly basis, the index was down 1.8%. In the UK, the FTSE 100 edged up 0.06%, gaining 51 points to close at 7,964.18.
Materials stocks were stronger, supported by gains in iron ore and copper prices. Market optimism around potential Chinese stimulus to boost domestic consumption in response to US tariffs also provided a lift. Gold miners advanced as well, following a strong rally in the gold price.
Across both the continent and the UK, banking shares gained ground, buoyed by strong earnings results from US peers. HSBC rose 1.34%, and Societe Generale also recorded gains adding 2.49%. However, BNP Paribas fell 2.4% after reports indicated that the European Central Bank (ECB) would not grant favourable capital treatment for its proposed acquisition of French insurer AXA.
ECB President Christine Lagarde, in a speech on Friday, stated that the central bank stands ready to deploy its tools if needed to preserve financial stability. She also noted that European financial markets have continued to function effectively despite recent turbulence.
Germany’s 10-year bond yield fell 1 basis points to 2.565%, while the UK 10-year gilt yield increased by 10 basis points to 4.75%. The euro also gained, with EUR/USD trading higher on the day by 1.35% to 1.1355 and the British Pound was higher by 0.90% to 1.3087
Australia
In Friday evening trading, ASX200 futures rose by 18 points, or 0.23%. The Australian dollar also gained ground, beginning the week at USD 0.6289 after advancing 1.04%.
Earlier in the day, the equity market recovered from early losses but still closed 0.82% lower, down 63 points at 7,646.50. All sectors of the index ended in the red, except for consumer discretionary, which gained 0.41%. The worst-performing sectors were healthcare and utilities, each declining by over 2%.
The healthcare sector was weighed down by market heavyweight CSL, which fell 3.6% to $233.08. The decline followed concerns that pharmaceutical companies could be the next target of US tariffs, as suggested by the US administration during the week. Cochlear also declined, falling 2.41% to $250.58.
Within the materials sector, iron ore miners came under pressure while gold stocks rallied strongly. BHP dropped 1.61% to $35.42, and Rio Tinto slipped 1.18%, or $1.30, to close at $109.29. In contrast, gold miners soared as ongoing turmoil in risk assets pushed gold above USD 3,200 per ounce. Evolution Mining surged 7.84% to $7.70, gaining 56 cents, while Emerald Resources jumped 8.42% to $4.12. Emerald reported on Thursday that gold production from its Cambodian mine met expectations. Both companies also benefited from broker upgrades.
Financial stocks were mixed amid heightened volatility, with the sector broadly in line with the broader market, falling 0.89%. CBA managed a slight gain to finish at $154.68, while NAB and ANZ each fell 1.71%. Westpac was the weakest of the major banks, down 1.86%.
Bond yields moved higher, with the Australian 10-year yield rising to 4.39%, while the 2-year yield dropped 6 basis points to 3.25%.
Looking ahead, the local calendar is relatively light, with the release of the RBA’s April board meeting minutes being the key domestic event. However, shifting developments around global trade tariffs are expected to keep volatility elevated across risk assets.
Commodities
Gold surged on Friday, gaining 1.93% or US$61.38 to close at US$3,237.61, as concerns over escalating trade wars and a weakening US dollar drove safe-haven demand. Silver also rallied, rising 3.47% to US$32.31.
Bitcoin extended its recent gains, trading at US$83,271 on Sunday — up 4.2% from Thursday’s close, as renewed institutional interest and risk-on sentiment supported crypto markets.
Oil prices climbed following comments from US Energy Secretary Chris Wright, who stated that the US may seek to eliminate Iranian oil exports as a means to pressure Iran’s nuclear ambitions through stricter enforcement. West Texas Intermediate rose 2.38% to US$61.50, while Brent crude gained 2.26%. However, the US Energy Information Administration cautioned that global tariffs could dampen oil demand and economic growth, lowering its global growth projections.
Copper advanced 1.8% (+US$166) to US$9,154 per tonne on the LME, supported by a weaker US dollar and speculation of renewed Chinese stimulus to counteract trade-related economic headwinds. Iron ore also firmed, closing at US$98.00 in New York trade on Saturday, up 0.90%.
Economic Calendar
China:
- Balance of Trade (Mar) – 2:00pm
US:
- NY Fed 1 Year Inflation Expectations (Mar) – 1:00am
This article was written by Paul Darwell, Rivkin Securities Pty Ltd. Enquiries can be made via [email protected] or by phoning +612 8302 3632.
