Global Markets Are Lifted by Trade Optimism (28 April - 2 May)

The dollar rose above 99.5, supported by Trump’s trade reassurances and softer stance on Powell. The euro closed at $1.1350, up 5% this month after the ECB cut rates to 2.25%. The yen weakened to 143.65 as trade optimism grew, while Tokyo inflation rose to 3.4%.

Brent climbed 0.5% to $66.90 but fell 2% for the week amid oversupply fears. Gold dipped below $3,290 after easing trade tensions and a stronger dollar, though still up 30% this year. Silver ended at $33.00, retreating as talks with China and Japan progressed.

U.S. 10-year yields ended lower. Japan’s 10-year yields edged higher, while German yields stayed flat at nearly 2.47%.

US S&P Global Manufacturing PMI (Apr)

The PMI rose to 50.7 in April 2025 from 50.2 in March, beating forecasts of 49.1 and marking four months of expansion. Output grew modestly and new orders rose, though export orders dropped sharply due to tariffs. Employment fell for the first time since October. Input costs surged, pushing output inflation to a 29-month high. Business confidence dropped to the lowest since August 2024.

US S&P Global Services PMI (Apr)

The Services PMI dropped to 51.4 in April from 54.4 in March, below expectations of 52.5. New orders fell sharply due to client uncertainty and tariffs. Hiring slowed amid a tight labor market. Input cost inflation hit a seven-month high. Business confidence fell to the lowest since October 2022.

US New Home Sales (Mar)

Sales rose 7.4% to 724,000 units, beating expectations of 680,000, the highest in six months. Growth was driven by the South and Midwest, offsetting declines in the Northeast and West. Median home price eased 1.9% to $403,600. Inventory stood at 503,000 units, equal to 8.3 months of supply.

US Durable Goods Orders (Mar)

Durable goods orders jumped 9.2% to $315.7 billion, far surpassing the expected 2% rise. Transportation equipment surged 27%, mainly from commercial aircraft. Excluding transportation, orders were flat. Capital goods orders rose 24.3%, but core business investment only rose 0.1%.

US Initial Jobless Claims (Mid-Apr)

Claims rose by 6,000 to 222,000, matching expectations. Continuing claims dropped by 37,000 to 1.84 million, the lowest in two months. Federal government claims edged up slightly, with severance payments delaying filings.

US Existing Home Sales (Mar)

Existing home sales fell 5.6% to 4.02 million units, missing forecasts of 4.13 million. Despite improved mortgage applications, affordability issues persisted. NAR’s Lawrence Yun warned that housing mobility challenges could weigh on the broader economy.

Currencies

The dollar rose above 99.5, supported by Trump’s reassurance on trade talks and Powell’s stability. The euro ended near $1.1350 after the ECB cut rates to 2.25% and removed restrictive language. The euro gained over 5% this month. The yen weakened to 143.65 as trade optimism lifted the dollar. Tokyo core inflation jumped to 3.4%, complicating BOJ policy.

Commodities

Brent rose 0.5% to $66.90 but ended the week 2% lower due to oversupply concerns and mixed trade signals. Progress with Russia on Ukraine and OPEC+ output hikes weighed on prices.

Gold slid below $3,290 after reaching $3,500 earlier in the week. Tariff exemptions from China and a stronger dollar reduced safe-haven demand.

Silver ended at $33.00, pressured by dollar strength and improved trade outlook with China, Japan, and South Korea.

Equities

The Nasdaq surged 6.16%, the S&P 500 gained 4.3%, and the Dow rose 2.48% this week. Optimism over trade negotiations and Trump’s support for Powell improved sentiment, alongside strong corporate earnings.