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Market Quick Take – 25 April 2025

Market drivers and catalysts

• Equities: Tech earnings boost after-market; Alphabet, Intel volatile; trade optimism supports global rally
• Volatility: VIX declines significantly; reduced anxiety; cautious optimism ahead of earnings
• Digital Assets: Bitcoin stabilizes post-surge; mixed altcoins; institutional ETF inflows high
• Currencies: Improved risk sentiment triggers profit taking in EUR and JPY
• Fixed Income: US Treasuries are heading for a small weekly gain
• Commodities: Natural gas loss offsetting weekly gains in metals and softs
• Macro events: US April (final) U. of Michigan Sentiment

Macro data and headlines

• China may suspend its 125% tariff on some US imports, as the economic costs of the trade war weigh heavily on certain industries. Medical equipment and ethane are among goods that may see exemptions. Meanwhile, Trump said his administration was talking with China on trade, despite Beijing denying the existence of negotiations on a deal and demanding the US revoke all unilateral tariffs.
• Market risk sentiment further improved after Fed Govenor Waller said he would support rate cuts in the event of aggressive tariff levels hurt the jobs market, while Cleveland Fed President Hammack said the Fed could move on rates as early as June.
• Tokyo's Core CPI increased by 3.4%, surpassing March's 2.4% and market expectations of 3.2%. This is the sixth month with inflation at or above the Bank of Japan's 2% target, suggesting a shift towards monetary policy normalization. However, the Bank of Japan is expected to keep its 0.5% policy rate due to uncertainty over new U.S. tariffs.
• US durable goods orders rose 9.2% to $315.7 billion, exceeding the expected 2% increase, mainly due to a surge in commercial aircraft orders. Transportation equipment orders increased 27%, with nondefense aircraft and parts up 139% and motor vehicles and parts up 2.3%. Excluding transportation, orders were stable.
• US existing home sales fell 5.6% to an annual rate of 4.02 million units, below the expected 4.13 million, marking the steepest decline in over two years. This occurred despite a slight decrease in borrowing costs, which boosted mortgage applications.

Macro calendar highlights (times in GMT)

0600 – UK March Retail Sales
1400 – US April University of Michigan Sentiment (final)

Earnings events

• Friday: BYD, Abbvie, HCA Healthcare, Aon, Colgate Palmolive, Charter Communications, Schlumberger
• Next week: Schneider Electric, Visa, Coca-Cola, AstraZeneca, Booking, Pfizer, Honeywell, Starbucks, Microsoft, Meta, Qualcomm, Caterpillar, Airbus, and many more.

For all macro, earnings, and dividend events check Saxo’s calendar.

Equities

• US: US stocks rose strongly Thursday for a third consecutive day, with major indices posting significant gains driven by robust earnings in the tech sector. The S&P 500 jumped +2.03%, Nasdaq surged +2.74%, and Dow Jones added +1.23%. After-market, Alphabet reported strong quarterly results, rising +5% in extended trading, which also lifted sentiment for other tech giants such as Nvidia (+1.1%), Meta (+4%), and Amazon (+1.8%), all after-market moves. Notably, Intel declined 5.7% after-hours due to weak forecasts and planned workforce reductions. Investor optimism was supported by hints from the Federal Reserve of potential rate cuts and signs of easing US-China trade tensions.
• Europe: European markets closed higher Thursday, marking a third day of gains as tariff concerns moderated. STOXX 600 gained +0.5%, DAX rose +0.49%, and CAC 40 edged up +0.27%. The auto sector rallied, buoyed by strong Renault results (+4%) and reports of potential US tariff exemptions on car parts. Infineon (+8%) and ASML (+2%) outperformed within the chip sector. Mixed earnings impacted the broader market: Adidas (+2.5%) reported better-than-expected results, while Nokia plunged 9.5% after lowering its guidance amid tariff impacts.
• UK: The FTSE 100 closed marginally higher (+0.05%), extending gains for the ninth consecutive day, supported by positive sentiment spilling over from the US. Weir Group (+4.5%) and St James’s Place (+2.2%) performed strongly following upbeat updates. However, financials lagged, with NatWest (-1.6%) and Barclays (-1.4%) weighing on sentiment amid caution around trade uncertainties and upcoming earnings. Unilever (-0.5%) dipped slightly on cautious forward guidance.
• Asia: Asian stocks mostly advanced Friday, led by strong gains in technology shares following upbeat US earnings from Alphabet and optimism around US-China trade developments. Japan’s Nikkei gained around +1.4%, supported by tech stocks despite hotter-than-expected Tokyo inflation data. Hong Kong’s Hang Seng (+0.9%) and Korea’s Kospi (+1.2%) rose amid trade optimism, boosted by gains in major tech firms like Samsung and SK Hynix. Chinese markets lagged due to persistent trade uncertainties and muted sentiment.

Volatility

The VIX dropped sharply Thursday, down nearly 7% to 26.47, marking its lowest close since early April, reflecting reduced market anxiety amid easing tariff concerns and strong tech earnings. VIX futures indicate cautious optimism heading into Friday’s session. Traders remain focused on ongoing earnings reports and potential developments in geopolitical negotiations, particularly US-China and Ukraine-Russia tensions.

Digital Assets

Bitcoin steadied around $93,350 after a sharp mid-week surge driven by easing US-China tariff tensions. Ethereum traded flat at $1,771, XRP slightly declined to $2.19, and Solana was stable at $152. Crypto-related stocks saw mixed results: Coinbase jumped nearly +5%, Riot Blockchain rose +3.9%, while Marathon Digital slid -0.9%. Institutional interest remained strong, with significant inflows into Bitcoin ETFs amid improving sentiment.

Fixed Income

• US Treasuries were heading for a small weekly gain, supported by a strong seven-year note auction and Fed officials indicating they would be open to cutting rates earlier than expected. The 10-year benchmark yield trades at 4.3% following a roller-coaster month that so far has seen a wide 4% to 4.5% range.

Commodities

• The commodities sector trades near unchanged on the week, with gains across industrial metals (aluminium 4%), precious metals (silver 2.5%), and not least softs led (coffee 7% and cotton 4%) being offset by losses in grains (wheat –2.8%) and not least energy, led by a 7.5% slump in natural gas.
• Natural gas futures fell to a five-month low at USD 2.93 after the EIA reported a bigger-than-expected storage increase. Since the March peak, prices have tumbled more than one-third, and while macroeconomic developments in early April drove it below USD 4, we have since seen robust production and mild spring weather add further downward pressure, despite record levels of LNG exports.
• Gold is heading for a weekly loss, as it continues to consolidate following a firm rejection and retracement from USD 3,500 earlier in the week. An improved market risk sentiment may weigh on gold in the short term, without, in our opinion, damaging an overall positive outlook for bullion.

Currencies

• The US dollar is heading for a small weekly gain with gains seen against most of its major peers, including CHF, KRW, JPY and EUR as risk sentiment continued to improve after the White House struck a more consolatory tone on tariffs, and China weighing exempting some US goods from tariffs.
• USDJPY broke higher to 143.60 after once again finding solid support around 140 earlier in the week.
• EURUSD trades near 1.13 support after twice being rejected at 1.14, with a break below potentially forcing additional euro long liquidation.

For a global look at markets – go to Inspiration.