Finance Digest: Jobs, Tariffs, and China!
A new weekly column recapping and previewing the top financial news
Welcome to The Austin Beacon’s newest column! We strive to share the talent, passions and intellect of UATX students, and this morning we are proud to announce a new student column!
Every Monday morning, Jack Erickson (UATX 28’) will bring you a quick breakdown of the biggest financial stories from the past week, along with a preview at what to watch out for in the week ahead. The goal is to give you a clear vision of where the markets and financial world stand.
Jack is a student whose passion for economics and the financial world was inspired by modern-day entrepreneurs, leading him to co-found AustinXChange, a social organization connecting UATX and UT.
Thanks for reading and stay tuned for more each week!
Events from Last Week
1. Markets Log Longest Rally Since 2004 (May 2nd)
On Friday, May 2nd, the S&P 500 closed higher, capping off nine consecutive days of gains, the longest winning streak since 2004. The Dow Jones Industrial Average and Nasdaq also received significant gains, effectively erasing earlier losses in April due to tariffs. Such a considerable rally indicates an increase in investor confidence, which has been driven by strong employment data and decreased trade tensions. Despite the large rally, the market has still experienced year-to-date losses. Click here to read more.
2. April Jobs Report Exceeds Expectations (May 2nd)
The U.S. economy added 177,000 jobs in April, which surpassed the forecasts of 133,000. Healthcare led job creation with 51,000 jobs added, while federal employment declined by 9,000. Across the economy, the overall unemployment rate remained steady at 4.2%. With the job report exceeding expectations, there is a broader sense of economic resilience during a time of trade uncertainty. However, with ongoing tariff policies, the resilience we saw in April is not guaranteed. Click here to read more.
3. Apple Warns of $900 Million Tariff Impact (May 1)
On Thursday, May 1st, Apple reported that U.S. tariffs are expected to add $900 million to its costs in the current quarter. To adjust, Apple is shifting production of iPhones to India and other products to Vietnam in hopes of mitigating the impact. Despite these strategic moves, Apple’s stock fell nearly 4% after their announcement, reflecting investor concerns. As one of the most valuable companies in the world, Apple's performance can influence markets greatly. Ongoing trade negotiations remain something to look out for as this further develops. Click here to read more.
4. U.S. and China Announce Tariff Exemptions (May 2)
China’s Commercial Ministry announced it is evaluating a U.S. offer to resume trade talks, following President Trump’s imposition of 145% tariffs on Chinese goods. Beijing made clear that for negotiations to proceed, the U.S. must avoid “extortion and coercion”. With tensions lowering, global markets have reacted positively, but the situation remains volatile and any resumption of hostility may erase recent gains. Click here to read more.
5. U.S. and Ukraine Sign Economic Agreement (April 30)
On Wednesday, April 30th, the U.S. and Ukraine signed a new Reconstruction Investment Fund agreement aimed at driving global capital into Ukraine’s recovery. The fund will be backed by revenues from Ukraine’s future mineral and energy production, including lithium mining. With this agreement, the U.S. is reinforcing its support for Ukraine while securing long-term access to essential inputs for the future of our energy and tech manufacturing. Click here to read more.
Forecast for the Week of May 5th
Federal Reserve Speeches (May 6-8)
Several Fed officials, including Chair Jerome Powell, are scheduled to speak this week. Markets will be analyzing every word for clues on future interest rate movements.
Consumer Price Index (CPI) Release (May 10)
The inflation report is the most anticipated data of the week. If CPI comes in high, it could revive fears of more Fed rate hikes. If the number comes in lower it may strengthen the case for a pause.
Big Earning: Nvidia, Walt Disney, Uber, PepsiCo
Earnings from Disney and PepsiCo will offer a good read on consumer confidence while Nvidia and Uber will offer a read on tech momentum. Nvidia in particular is the one to look out for as the AI frenzy continues.
Ongoing U.S. - China Trade Developments
With both countries signaling openness to resume talks, any movement could affect markets positively or negatively. As negotiations progress, this remains an important area to keep an eye on.
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