https://x.com/elerianm/status/1919090744049951039
The U.S. economy contracted in the first quarter of 2025, marking the first decline since 2022, according to the Commerce Department. The GDP fell partially due to a 41% surge in imports as companies tried to get ahead of President Donald Trump’s tariffs. Consumer spending also slowed down, and government expenditures declined.
https://x.com/elerianm/status/1918771192510517653
Despite the negative GDP figures, consumer spending showed resilience, with a separate report indicating a 0.7% increase in March, exceeding economists’ expectations of 0.5%. Traders initially reacted negatively to the economic data, but sentiment improved later in the day, leading to a remarkable recovery in stocks. President Trump’s reciprocal tariff announcement on April 2 had previously sent the market into a tailspin, but a partial rollback of these tariffs helped stabilize the situation.
The S&P 500 ended April with a roughly 0.8% loss, while the Dow was down 3.2%. The Nasdaq, however, posted a nearly 0.9% advance for the month.
Gdp contraction spurs mixed market reactions
https://x.com/LizAnnSonders/status/1919391721915367487
Jed Ellerbroek of Argent Capital Management emphasized the continued development and impact of AI tools and capabilities, noting that uncertainty around the Trump administration’s tariffs might last for years. President Trump criticized China in a cabinet meeting, labeling it the “leading candidate for the ‘chief rip-off artist'” due to its trade policies against the U.S. He also blamed the weak first-quarter GDP on his predecessor, indicating that he would have more success in improving the economy in the second quarter. On Wednesday, only two S&P 500 sectors — consumer staples and health care — managed to trade higher amid fears of a looming recession.
Energy stocks experienced their worst April on record, with the broad index’s energy sector tumbling around 14.5% for the month. Etsy shares tumbled 9% due to uncertainty around tariffs and consumer confidence, despite strong earnings results. Seagate’s stock surged almost 9% following an upbeat earnings report and positive guidance.
Six stocks in the S&P 500 hit new 52-week highs, driven by strong performances from companies such as Netflix and Palantir. Energy stocks, however, were particularly hard-hit, with every stock in the sector ending the month in the red. As April closes out, investors are watching for any signs of economic recovery or further downturns in the coming months.