May 14, 2025

The Pulse: Global Economic and Market News for Wednesday, May 14, 2025

Global markets showed resilience on May 14, 2025, as investors continued to digest the recent U.S.-China tariff truce and a softer inflation report while awaiting further trade and monetary policy developments. The mood was cautiously optimistic, with technology stocks leading gains and market participants monitoring corporate earnings and international negotiations.

Market Performance

• The S&P 500 edged up 0.1% to 5,892.58, extending its recovery and turning positive for the year for the first time since late February. The Nasdaq Composite advanced 0.7% to 19,146.81, powered by strong performances from major technology firms such as Nvidia, AMD, and Alphabet. In contrast, the Dow Jones Industrial Average slipped 0.2% to 42,051.06, weighed down by weakness in select retail and industrial names23.

• The Russell 2000 index, which tracks smaller companies, fell 0.9% to 2,083.80, reflecting ongoing uncertainty for more domestically focused firms2.

• Treasury yields rose, with the 10-year note reaching 4.48%, while the U.S. dollar index slipped 0.4% as investors rotated into equities and away from safe-haven assets7.

Drivers and Sector Highlights

• The market’s positive tone followed the announcement of a 90-day U.S.-China trade truce, which reduced U.S. tariffs on Chinese imports from 145% to 30% and Chinese tariffs on American goods from 125% to 10%. This agreement, reached over the weekend, has been credited with averting a deeper global economic downturn and restoring some confidence in international trade flows18.

• Technology and semiconductor stocks outperformed, with Nvidia up 3%, AMD climbing 5%, and Super Micro Computer surged 17% on robust AI and data center hardware demand. The sector benefited from expectations of relaxed chip export restrictions and new international partnerships, notably with Saudi Arabia36.

• Retail stocks were mixed. American Eagle Outfitters dropped 6.4% after retracting its financial forecasts, citing macroeconomic uncertainty and higher promotional activity. Other retailers, including Urban Outfitters and Abercrombie & Fitch, also faced pressure in after-hours trading25.

• In commodities, gold prices fell as risk appetite returned, while oil prices slipped on news of higher U.S. crude inventories and OPEC’s trimmed supply growth forecast67.

Economic Data and Policy Outlook

• U.S. consumer prices rose by 0.2% in April, slightly below economists’ expectations and following a 0.1% decline in March. Analysts noted that the latest round of tariffs did not significantly impact consumer prices, providing relief to markets and supporting the case for potential Federal Reserve rate cuts later in the year13.

• Traders are now pricing in at least two 25-basis-point Fed rate cuts before year-end, with the first expected in September 1.

• Globally, the IMF projects growth of 3.3% for both 2025 and 2026 but notes that risks remain tilted to the downside amid policy uncertainty, persistent inflation pressures, and a slow recovery in business and consumer sentiment48.

Geopolitical and Trade Developments

• President Trump began a four-day visit to the Gulf region, including talks with Syria’s president in Saudi Arabia, as investors watch for further trade and diplomatic agreements16.

• The U.S.-China truce followed earlier pauses in tariffs for other trading partners and a limited U.S.-UK trade deal, all contributing to the market’s rebound from April lows18.

Disclosure

This article is for informational purposes only and does not constitute investment advice, an offer to sell, or a solicitation to buy any securities. All information is based on publicly available sources as of May 14, 2025. The author holds no positions in the securities mentioned. Readers should consult financial professionals before making investment decisions.

Sources

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The Pulse: Global Economic and Market News for Wednesday, May 14, 2025

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