Midday Market Roundup for Thursday, May 15, 2025

Good afternoon. Here are the top four global financial and economic topics shaping markets at midday, Thursday, May 15, 2025:

1. U.K. Economy Outperforms Expectations, But Growth Likely Short-Lived

The U.K. economy grew by 0.7% in Q1 2025, surpassing the 0.6% forecast. This growth was driven by a 0.7% rise in services and 1.1% production growth, though construction stagnated. Sanjay Raja of Deutsche Bank cautioned that this surge is temporary, citing pre-tariff stockpiling and seasonal factors. He anticipates a Q2 slowdown before a gradual recovery into 2026. This growth contrasts with the eurozone’s stagnation, highlighting regional divergences. The U.K.'s outperformance could potentially influence global investment strategies, particularly in the context of Brexit (CNBC; LinkedIn).

2. U.S. Retail and Health Stocks Volatile Amid Earnings, Tariff Concerns

•               Walmart shares dipped 1% after narrowly missing Q1 sales estimates ($165.61B vs. $165.84B expected), warning of tariff-driven price hikes.

•               Dick’s Sporting Goods plunged 14% on its $2.4B Foot Locker acquisition, while Foot Locker surged 85%.

•               UnitedHealth tumbled 15% to a five-year low amid a DOJ Medicare fraud probe.

•               Cisco rose 6% after beating earnings and offering upbeat guidance.

Mixed signals reflect consumer caution and sector-specific risks (Yahoo Finance; CNBC).

3. Global Markets Shift to Risk-Off Mode Amid Fading Trade Optimism

Stocks, the dollar, and commodities retreated as the euphoria surrounding the U.S.-China tariff truce waned. Safe-haven assets like the yen and Swiss franc gained while bond prices rose. The market is eagerly awaiting the U.S. retail sales data and Fed Chair Powell’s remarks for clarity. Meanwhile, President Trump noted progress on a nuclear deal with Iran, and Republican lawmakers advanced budget proposals adding trillions to U.S. debt (Reuters; LinkedIn).

4. Central Banks Navigate Mixed Signals; Geopolitics Weigh on Trade

•               The Federal Reserve held rates at 4.25–4.50%, balancing 3.1% inflation against tepid Q1 GDP growth (1.4%).

•               The Bank of England cut rates to 4.25%, its fourth reduction since 2024, to counter slowing growth despite a new U.S. trade deal retaining 10% tariffs on key exports.

•               China’s PBOC signaled further easing as exports rose 2.5%, but imports fell 1.1%, underscoring domestic weakness. Soybean imports hit a 12-year low, shifting trade dynamics with Brazil (LinkedIn; Reuters).

Sources:

• CNBC: UK GDP Growth and Market Movers
• Yahoo Finance & CNBC: U.S. Retail and Health Stocks
• Reuters & LinkedIn: Global Risk Sentiment and Central Banks
• LinkedIn: Geopolitical Trade Impacts

Disclosure:
The information provided is for informational purposes only and does not constitute investment advice. This content is not a recommendation to buy/sell securities. Consult a qualified financial advisor before making investment decisions.

Views expressed are based on cited sources, but accuracy is not guaranteed. Forward-looking statements reflect current expectations and may change.

Investing involves risk, including potential loss of principal. Past performance does not guarantee future results.

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