Market Insights: Rally Caps Volatile Week

Raymond M Backers, CFP®, MPAS®, EA, APMA®

April 14, 2025

Stocks ended the week with a strong gain as traders continued to focus on tariff talks while appearing to overlook upbeat news on inflation.

The Standard & Poor’s 500 Index rose 5.70 percent, while the Nasdaq Composite Index gained 7.29 percent. The Dow Jones Industrial Average picked up 4.95 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, increased by 0.72 percent.^1,2

Stocks Rebound

Stocks rallied on Monday after a report surfaced that the administration was considering a 90-day pause on tariffs. But when the White House clarified its position, sellers stepped in.

On Tuesday, prices jumped at the next opening bell after the Treasury Secretary said the U.S. was open to tariff negotiations with trading partners. The rally stalled and reversed on news the administration was adjusting tariffs on Chinese imports.³

After the White House announced a 90-day pause on specific tariffs on Wednesday, markets pushed higher. The S&P 500 gained 9.5 percent, its largest one-day increase in 17 years.⁴

Stocks fell again Thursday morning, appearing to overlook an upbeat Consumer Price Index report showing that core inflation (excluding food and energy) rose at a 2.8 percent annual rate–the best number in more than four years. Stocks finished the week with a powerful rally, capping a volatile trading week.^5,6

Watching the Bond Market

The yield on the 10-year Treasury rose more than 50 basis points for the week, marking one of the most significant moves on record. (When bond yields increase, bond prices tend to move lower.)

The week’s action was unexpected. In the past, investors have turned to U.S. bonds during market turbulence. However, the ongoing tariff talks have, at least temporarily, influenced how some overseas investors view U.S. bonds.^7,8

The bond market activity influenced the mortgage market, where the average rate on the popular 30-year fixed mortgage closed Friday at 7.1 percent, its highest level in two months.⁹

This Week: Key Economic Data

Monday: Philadelphia Fed President Patrick Harker and Atlanta Fed President Bostic speak.

Tuesday: Import Price Index.

Wednesday: Retail Sales. Industrial Production. Business Inventories. Home Builder Confidence Index. Cleveland Fed President Hammack speaks.

Thursday: Housing Starts. Building Permits.

Friday: San Francisco Fed President Mary Daly speaks.

^{Source: Investors Business Daily - Econoday economic calendar; April 11, 2025}^{The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.}

This Week: Companies Reporting Earnings

Monday: The Goldman Sachs Group, Inc. (GS)

Tuesday: Johnson & Johnson (JNJ), Bank of America Corporation (BAC), Citigroup Inc. (C)

Wednesday: Abbott Laboratories (ABT), Prologis, Inc. (PLD)

Thursday: UnitedHealth Group Incorporated (UNH), Netflix, Inc. (NFLX), American Express Company (AXP), Marsh & McLennan Companies, Inc. (MMC), The Blackstone Group (BX), Infosys (INFY)

^{Source: Zacks, April 11, 2025.}^{Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.}

"I think that we communicate only too well, in our silence, in what is unsaid, and that what takes place is a continual evasion, desperate rear-guard attempts to keep ourselves to ourselves. Communication is too alarming."

– Harold Pinter

Tax Tips for Farmers

If you own a farm, ranch, range, or orchard, here are some tax tips to consider:

Insurance payments from crop damage may count as income. Check with your tax professional.
If you sold livestock or items you bought for resale, you may have a taxable event.
You may be able to deduct ordinary and necessary expenses that you paid for your business.
Consider the tax treatment of your farm’s full and part-time workers.
If your expenses are more than your income for the year, you may have a net operating loss. You may be able to carry that loss over to other years.

This information is not a substitute for individualized tax advice. Please discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS¹⁰

How to Measure Your Heart Rate (Without a Smart Device)

There are so many smart gadgets to help us monitor our health, but knowing how to measure your heart rate without any tech is important to monitor your overall health.

To measure your heart rate, gently place your index and middle finger on a pulse point, such as your wrist right below the base of your thumb or your neck right under your jawbone.
Lightly press until you can feel your heartbeat, then count the number of beats in 15 seconds. You’ll need a watch or clock to time yourself.
Multiply this number by 4 to get your heart rate per minute.
Feel free to repeat this exercise a few times to confirm your reading's accuracy.

Tip adapted from Harvard Medical School¹¹

I have a horn and am almost as large as a car, but I will never honk my horn or outrun a car or truck. What might I be?

Last week’s riddle: I can certainly run, but I will never be able to walk by myself. Wherever I go, thoughts are close behind me. What am I?
Answer: A nose.

Scenic Highway 93
Alberta, Canada

Footnotes and Sources

^{1. The Wall Street Journal, April 11, 2025}

^{2. Investing.com, April 11, 2025}

^{3. CNBC.com, April 8, 2025}

^{4. The Wall Street Journal, April 9, 2025}

^{5. The Wall Street Journal, April 10, 2025}

^{6. MarketWatch.com, April 11, 2025}

^{7. WSJ.com, April 9, 2025}

^{8. MarketWatch.com, April 9, 2025}

^{9. CNBC.com, April 11, 2025}

^{10. IRS.gov, June 4, 2024}

^{11. Harvard Medical School, December 12, 2024}

Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.

The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.

The market indexes discussed are unmanaged, and generally, considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results.

The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general.

U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.

International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility.

Please consult your financial professional for additional information.

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