Stocks cap a manic week with their best performance since November 2023
The stock market experienced a rollercoaster ride last week, with investors on edge due to the escalating trade war between the U.S. and China. Despite the turmoil, stocks managed to end the week on a positive note, with the S&P 500 gaining 1.8%, the Dow Jones Industrial Average adding 1.6%, and the Nasdaq Composite rising 2.1%.
The S&P 500 had its best weekly performance since November, while the Nasdaq saw its best week since November 2022. However, economists are warning that the trade tensions between the two economic giants could impact the nation’s growth.
The trade war reached a new level when Beijing announced that it would raise tariffs on U.S. goods to 125%, matching the duties imposed by President Trump on Chinese goods. This tit-for-tat escalation has raised concerns about the impact on both economies.
The bond market also experienced pressure last week, with signs of stress that caught the attention of Wall Street and President Trump. Gold prices rose more than 2% to $3,250 per ounce as investors sought safe havens amid the uncertainty.
Despite the recent gains, the S&P 500 is still down nearly 13% from its peak in February, reflecting investor worries about the impact of tariffs on corporate profits and the economy. Some analysts are even raising the possibility of a recession.
While there have been some positive developments, such as the Dow’s significant gains and inflation cooling more than expected in March, the underlying concerns about the trade war persist. Consumer confidence has also taken a hit, with the University of Michigan reporting a decline in sentiment to its lowest level since the pandemic.
In conclusion, the stock market remains volatile as investors navigate the uncertainties surrounding the trade war. While there have been moments of relief, the underlying tensions continue to weigh on market sentiment. It remains to be seen how the situation will evolve and what impact it will have on the economy in the coming weeks.
