
CIO Monthly Observations - May 2025
Monthly Observations
The S&P fell again in April, down -0.8%, which increased its year-to-date loss to -5.3%. However, the MSCI All Country World index rose 0.8% during the month, which lowered its year-to-date loss to only -0.9%. The Bloomberg BarCap U.S. Aggregate Bond index rose again, up 0.4% in March, increasing its year-to-date return to 3.2%.
On again, off again tariff announcements sent shockwaves through global stock markets, with most of the selloffs reversed in the US, and Europe actually saw a slight gain for the month. Given that there are approximately 3 months to work on trade deals before the tariffs pause is over, many investors are optimistic that other arrangements can be made to avert a repeat of this past month.
Monthly Highlights
The April 2nd tariffs caused a worldwide stock market meltdown
Treasury Secretary Bessent reassured markets with more details on the China trade war The tariffs were paused on April 9th leading most markets to begin a recovery
News in Review
On April 2nd, the US announced tariffs on the rest of the world and the next day the S&P 500 sold off close to 5% and the Nasdaq sold off around 6%. Although everyone was expecting some base level of tariffs to be announced, the size and the lack of exceptions for critical imports (e.g. the kind that would be used in things that were already majority-built in America) caught investors by surprise.
Bessent Expects Tariff Standoff with China to De-Escalate
Although the initial reaction to the tariffs was severe, Treasury Secretary Scott Bessent tried to calm markets by explaining that the initial 145% tariffs announced on China would not be maintained for a long period of time and were a more temporary measure. It is his intention to negotiate with other countries to bring trade and tariff barriers lower across the board.
Wall Street Rebounds Sharply After 90-day Tariff Pause is Announced
One week after tariffs caused a worldwide stock selloff, they were put on hold for 90 days and the S&P 500 jumped 9.5% in a single day, on Wednesday 4/9. This market rally undid most of the damage caused by the initial announcement and sparked hopes that deals could be made with other countries during the 90-day pause.
Life is Difficult for this Elon Musk Look-alike
A man who lives in Luxembourg says he is often mistaken for Elon Musk. Usually he laughs it off or lets people take pictures with him, but as the CEO of Tesla has gotten more well known, it has led to some awkward moments for him – but it has also led to millions of views on his social media page. For the most part he says you can’t take it too seriously and “have to see the funny side” of it.
DISCLOSURES
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