US Markets
Stocks were mixed in April as investors weighed slowing economic data, earnings reports, and evolving expectations around Fed interest rate policy.
The S&P 500 slipped 0.7%, the Dow Jones Industrial Average fell 1.4%, and the Nasdaq Composite dropped 1.2%.¹
A Shift in Market Mood
After a strong first quarter, stocks cooled in April amid signs the U.S. economy may be losing a bit of momentum.
Weaker-than-expected retail sales and softer labor market data raised questions about how quickly growth may be slowing—and whether it will be enough to prompt the Federal Reserve to cut interest rates soon.
Investors were particularly focused on inflation data, with March’s Consumer Price Index coming in slightly hotter than expected.
That dashed hopes for a Fed rate cut in May and prompted a bit of volatility across stock and bond markets.²
Earnings Season in Focus
Q1 corporate earnings began to roll in, with mixed results. Big tech names continued to lead, with strong reports from several AI-focused companies helping to support the broader market.
However, many companies issued cautious guidance for the rest of the year, reflecting ongoing cost pressures and a slower economic backdrop.
This more conservative tone added to the market’s cautious mood.
The Fed
As expected, the Federal Reserve left interest rates unchanged at its late-April meeting, keeping the Fed Funds Rate at 5.25%–5.50%.³
In his post-meeting press conference, Chair Jerome Powell acknowledged that inflation has proven “stickier” than hoped.
He reiterated that while the Fed still expects to cut rates in 2025, the timing will depend on more convincing progress on inflation.
Markets are now pricing in fewer rate cuts this year than previously anticipated—possibly just one or two, and not until later in the summer or early autumn.⁴
Global Markets
Global equities were slightly weaker on the month, in line with the U.S.
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MSCI EAFE Index (developed markets): -1.1%
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Emerging markets: -2.4%, led lower by declines in China and Brazil⁵
Europe: Markets were flat to slightly lower, with the European Central Bank also holding rates steady. Economic data across the eurozone was soft but stable.
Asia: Japan’s Nikkei saw a mild pullback after a strong run in Q1. China remained under pressure, as consumer sentiment and the property sector continued to weigh on investor confidence.
What to Watch in May
As we head into the next month, key themes to watch include:
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Inflation data: Another elevated CPI or PCE reading could push rate cuts further out.
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Earnings reports: More updates from retail, energy, and industrial firms could shape views on consumer strength and economic activity.
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Fed commentary: Several Fed officials are scheduled to speak in May, offering more clues on rate outlook.
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Geopolitics: Any developments in the Middle East or U.S. political landscape may contribute to market moves.
Our blog posts are intended for information purposes only and should not be interpreted as financial advice.
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Sources:
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S&P Dow Jones Indices – April 30, 2025
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U.S. Bureau of Labor Statistics – April 2025
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Federal Reserve FOMC Statement – April 30, 2025
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CME FedWatch Tool – April 2025
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MSCI, Bloomberg – April 30, 2025
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