The Week in Review 4/28/25
“As sure as time, history is repeating itself, and as sure as man is man, history is the last place he’ll look for his lessons.” – Harper Lee
Good Morning,
The stock market had a very strong showing last week.
The S&P 500 (+4.6%) exited correction territory, rising 10.9% from its low close on April 8 (4,982.77).
The Nasdaq Composite jumped 6.7% last week and the Dow Jones Industrial Average registered a 2.5% gain.
Things started the week relatively soft as stocks dropped on Monday in response to chatter that President Trump and his team are looking into whether the president can remove Fed Chair Powell, which fostered concerns about attacks on the Fed's independence.
Also, China warned of retaliation against countries that curtail their trade with China because of U.S. pressure in trade negotiations.
The mood shifted later in the week when President Trump declared that he has no intention of firing Fed Chair Powell.
He also indicated he won't play hardball with China in any negotiations and that China's tariff rate will come down substantially (but not to zero) if a deal can be reached.
The upside bias was aided by short-covering activity and contrarian-minded buying interest driven by reports of a pervasive bearish mindset. Outsized gains in the mega cap space contributed to the overall performance.
The outperformance of the mega caps was also reflected in S&P 500 sector performance. The technology sector bounced 7.9%, the consumer discretionary sector surged 7.4%, and the communication services sector rose 6.4%.
The huge batch of earnings news last week was headlined by a few mega caps. Tesla saw an 18.1% increase after a dour Q1 earnings report that was tempered by Elon Musk indicating he will be curtailing his DOGE work.
Alphabet shares jumped 6.8% after reporting earnings.
Last week also featured pleasing price action in the Treasury market, providing added support to equities. The 10-yr yield was six basis points lower than last week at 4.27% and the 2-yr yield was four basis points lower than last week at 3.76%.
The S&P 500 has now recouped 53% of the recent drawdown… partially driven by a shift to a softer tone in tariff rhetoric.
According to FactSet, “Since 1971 there have been 19 corrections that did not progress into a bear market, with an average decline of 14% from peak to bottom over an average of 4.3 months.
Historically, these sizable market pullbacks that took place within the confines of a bull market have been good times to add to equities, with stocks rising 18% six months after and 23% a year later.” Source: FactSetDurable goods orders surged 9.2% MoM in March, powered by a 139% jump in nondefense aircraft.
The IMF’s latest semi-annual World Economic Outlook reflected downward growth revisions from the pre-tariff baseline.
Have a wonderful week!
Michael D. Hilger, CEP®
Managing Director
Senior Vice President, Wealth Management
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