Weekly Market Summary: Employment, Trade Dialogue, and Mixed Expectations

Weekly Market Summary: Employment, Trade Dialogue, and Mixed Expectations

United States: Wall Street Breaks Records Following Surprising Jobs Report

The U.S. stock market closed the week with a strong rebound after the release of a solid April jobs report, which helped ease recession fears and reignited risk appetite on Wall Street.

The S&P 500 and its Longest Streak Since 2004

• S&P 500 closed up 1.47%, reaching 5,686.67 points, marking nine consecutive sessions of gains—its longest winning streak since November 2004.
• Dow Jones Industrial Average rose by 564.47 points, or 1.39%, ending at 41,317.43.
• Nasdaq Composite climbed 1.51%, closing at 17,977.73.

This recovery allowed both the S&P and the Nasdaq to erase losses accumulated since early April, when President Donald Trump announced his controversial “reciprocal” tariffs.

Jobs as a Catalyst: 177,000 New Positions

The main driver of the rally was the nonfarm payroll report, which revealed the creation of 177,000 jobs in April, surpassing analysts’ expectations of around 133,000. While this represents a slowdown from the 228,000 jobs added in March, the data was seen as an encouraging sign of the resilience of the U.S. labor market.

The unemployment rate held steady at 4.2%, in line with expectations, reinforcing perceptions of short-term economic stability.

Labor Market Defies Recession Fears

Markets breathed a sigh of relief as the employment data exceeded expectations. Despite ongoing concerns about a potential recession, the strong jobs report supports the narrative that the economic cycle still has room to run, especially if the trade conflict remains contained.

Optimism was also boosted by the expectation that, during the 90-day tariff pause announced by the White House, the environment could be more favorable for risk assets.

Trade Tensions and Signs of a Truce Between China and the U.S.

Trade tensions between the world’s two largest economies experienced a mild truce, which positively influenced market sentiment. China expressed willingness to resume negotiations with the United States, though it made clear that any progress would require the removal of the unilateral tariffs imposed by Washington.

China Open to Dialogue but Demands Tariff Removal

China’s Ministry of Commerce stated that Beijing keeps the door open to dialogue but expects clear signs of “sincerity” from Washington. “If the U.S. wants to talk, it must correct its mistakes and cancel the unilateral tariffs,” Chinese authorities said.

This change in tone came after President Trump announced a temporary 90-day suspension of tariffs for most countries—a move interpreted as an attempt to gain diplomatic leeway and calm markets.

Possible Effects of a New Round of Negotiations

The prospect of resuming talks has been met with cautious optimism in financial circles. A report from The Wall Street Journal indicated that Beijing might be open to discussions, though without guarantees of immediate concessions. Analysts believe a return to dialogue could help moderate volatility and restore some investor confidence.

U.S. Treasury Secretary Scott Bessent added that the outcome of this phase depends on China “de-escalating” its own positions, thereby opening the door to breaking the current deadlock.

Impact on Global Market Sentiment

These signals have had a significant psychological impact on markets, reducing the perceived risk of an escalation in the trade war. This relief was reflected in the performance of global indices and in the decreased demand for safe-haven assets like gold.

However, analysts warn that the situation remains highly volatile and subject to the fluctuations of political rhetoric. Markets have shown strong reactions when tariff threats turn into action, so everything will depend on what happens when the 90-day pause comes to an end.

Europe Catches the Optimism: Stock Rally After U.S. Jobs Data

The optimism stemming from Wall Street, driven by the strong U.S. jobs report, extended to European markets, which closed the week with significant gains amid a backdrop of reduced trade tensions and solid macroeconomic data.

The Stoxx 600 and Tech Sector Lead the Indices

Stoxx 600 index closed up 1.7%, led by the industrial and technology sectors, which each rose more than 2%. The recovery was broad-based, signaling an improvement in risk appetite after weeks of uncertainty caused by the trade war and global economic stagnation.

This movement also reflects the growing correlation between U.S. and European markets, where positive growth signals from the U.S. often serve as a confidence anchor for investors in the Old Continent.

UK’s FTSE 100 Hits All-Time High

In the United Kingdom, the FTSE 100 rose 1.2%, marking its 14th consecutive session of gains—matching its longest streak since 2017—and setting a new record for consecutive daily highs. The index has gained more than 5% so far this year, reflecting a combination of strong corporate earnings, a stable economic environment, and a relatively weak pound that benefits exporters.

France’s CAC 40 and Germany’s DAX 40 also rose by 2.3% and 2.5%, respectively.

Stable Inflation Boosts Euro Against Dollar

On the macroeconomic front, eurozone inflation held steady at 2.2% in April, surpassing forecasts of a slight decline to 2.1%. This price stability pushed the euro higher against the dollar, reflecting expectations that the European Central Bank (ECB) might leave its monetary policy unchanged in the near term.

The combination of positive economic data, signs of dialogue between China and the U.S., and Wall Street’s rebound fueled a week of recovery in Europe that reinforces the narrative that markets may have bottomed out after weeks of volatility.

Risk-Sensitive Markets: Gold and Oil Under Pressure

Unlike equities, so-called safe-haven assets showed a downward trend throughout the week, as risk appetite strengthened amid positive economic data and signs of geopolitical easing. Gold and oil, in particular, reflected shifts in investor expectations.

Gold Falls Amid Lower Risk Aversion and Rising Bond Yields

Spot gold fell 0.4% on Friday, trading around $3,228.50 per ounce, while U.S. gold futures closed higher at $3,243.30 in a technical move that did not prevent a weekly loss of 2.6%. The precious metal is pulling back from its record high of $3,500.05 reached on April 22.

The downward pressure intensified due to rising yields on 10-year U.S. Treasury bonds following the jobs report, which reduced gold’s appeal as a non-yielding asset. Additionally, the easing of trade tensions between the U.S. and China reduced demand for safe-haven investments.

If this trend continues, “prices could continue to retreat and break the key support level around $3,200.”

Oil Suffers Worst Week Since March Amid OPEC+ Decisions

• WTI crude oil fell 1.6% to close at $58.29 per barrel, posting a weekly loss of 7.7%.
• Brent dropped 1.4% to $61.29, with weekly losses of 8%.

This marks its worst week since late March, driven by uncertainty ahead of the upcoming OPEC+ meeting.

Traders anticipate that the cartel may decide on a moderate production increase in June, which would exert further downward pressure on prices. Additionally, Saudi Arabia reportedly informed its allies that it has no intention of intervening more aggressively in the markets.

Additional factors, such as the possible reactivation of sanctions on buyers of Iranian oil, the slowdown in global demand, and the recent decline in the number of active rigs in the U.S., complete the picture.

Geopolitics, Production, and Sanctions: The Forces at Play

Despite the slightly more conciliatory tone in U.S.–China relations, the energy market remains shaped by geopolitical events. President Trump’s warning about sanctions on those who buy Iranian crude adds new pressure, in a context where Iran is a key supplier to several Asian countries, including China.

Although there are signs of improvement in the bilateral relationship, the signals remain tentative, maintaining a high degree of uncertainty in energy markets.

Corporate Snapshot: Apple, Amazon, and Key Market Movers

While the broader indices celebrated positive macroeconomic data, the performance of some major publicly traded companies revealed a more nuanced dynamic—shaped by volatility, the impact of tariff policies, and future outlooks in key sectors like technology, energy, and healthcare.

Apple Disappoints in Services but Hits Revenue Record

Apple (AAPL) shares fell 3.7% after releasing mixed results for the second fiscal quarter. Although the company reached record revenue of $95.4 billion—driven by the success of the new iPhone 16e and gross margins of 47.1%—its services division failed to meet analysts’ expectations.

Additionally, the company projected a $900 million increase in costs related to tariffs imposed by the U.S., which dampened its positive momentum. Nevertheless, CEO Tim Cook confirmed an ambitious $500 billion investment plan in the U.S., including a new plant in Texas.

Amazon Faces Caution Despite Strong Quarterly Results

Amazon (AMZN) also posted results that exceeded expectations in revenue, earnings per share, and operating margin. However, the company issued a conservative outlook for the next quarter, citing ongoing tariff uncertainty and macroeconomic headwinds that continue to weigh on operations.

The market responded with a moderate decline in share price, although analysts remain optimistic in the long term. J.P. Morgan (JPM) reiterated its “Overweight” rating with a price target of $225.

Nvidia, Chevron, Exxon, and Other Firms Under Investor Scrutiny

Nvidia (NVDA) announced changes to its AI chip designs to comply with export restrictions to China, thereby avoiding sanctions and ensuring continuity with key clients like ByteDance and Tencent. The company anticipates a financial impact of $5.5 billion due to these adjustments.

Chevron (CVX) expressed interest in acquiring Phillips 66’s (PSX) stake in their petrochemical joint venture, aiming to diversify its exposure. Despite beating Q1 earnings estimates, Chevron announced it would reduce its share buyback program in Q2.

ExxonMobil (XOM) exceeded earnings expectations thanks to increased production in Guyana and the Permian Basin, although lower refining margins affected revenue. The company maintained its quarterly dividend at $0.99 per share.

Twilio (TWLO) was one of the positive surprises, with better-than-expected revenue and improved annual guidance, earning a price target upgrade from analysts.

This collection of results illustrates a disconnect between general macroeconomic optimism and the individual realities of companies, where factors like regulation, international trade, and technological innovation are reshaping the risk and opportunity landscape across markets.

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Permíteme presentarme: soy Ignacio N. Ayago, un emprendedor consolidado 🚀, papá con poderes 🦄, un apasionado de la tecnología y la inteligencia artificial 🤖 y el fundador de esta plataforma 💡. Estoy aquí para ser tu guía en este emocionante viaje hacia el crecimiento personal 🌱 y el éxito financiero 💰.

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