Morning Brew May 5 2025

Good morning,

U.S. Employment and Economic Indicators

The U.S. economy demonstrated resilience by adding 177,000 jobs in April, signalling continued growth. However, complacency should be avoided as underlying challenges persist, particularly in light of ongoing trade tensions.

Trade Tensions and Market Reactions

Beijing's recent announcement of evaluating Washington's offer to hold talks over President Donald Trump's 145% tariffs underscores the volatility in international trade relations. This situation demands careful consideration of potential impacts on global markets and your investment portfolio.

Trump put out a picture of himself as pope, earing bewilderment and over night announced a tariff of 100% on foreign made films.

Berkershire and Apple:

Saturday brought noteworthy news from Berkshire Hathaway, revealing that the legendary Warren Buffett will retire at the end of the year. The company, with record cash holdings, expressed a negative outlook on the USD and tariffs, suggesting caution in currency-related investments.

Warren Buffett Passes the Torch – 10 Lessons That Still Matter Today

 In corporate news, Apple experienced a nearly 4% decline in its stock value after reducing its share buyback programme by $10 billion. CEO Tim Cook's comments on tariffs potentially adding $900 million in costs this quarter further highlight the need for strategic planning in response to geopolitical factors.

Market Performance and Currency Movements

The DAX achieved its highest weekly close ever, reflecting robust market performance in Germany. Meanwhile, the USD gained ground as the EUR/USD fell below 1.13, and precious metals saw significant movements with gold closing at 3240, Silver 32, Now we are trading 32.30 and 3260 despite oil trading lower.

Equities are risk off over the weekend with the US 500 at 5651, the GER40 23070 and the US Tech 100 NAS 19980 – the USD Index fell below the 100 again to trade at 99.75.

Federal Reserve and Upcoming Events

President Trump confirmed that he will not remove Federal Reserve Chair Jerome Powell before his term ends in 2026, providing some stability in monetary policy leadership. Key events this week include U.S. and UK rate decisions, earnings reports, and speeches by Powell and Waller on Wednesday and Friday, which are likely to influence market dynamics. The fed is strongly expected to take no action at this meeting but the year end rate suggests 3 cuts.

Key today will be the Palanatir earnings after the bell and the Swiss CPI at 8:30

Geopolital Events

Yemen continued attacking Israel, barely missing Ben Gurion Airport, several airlines are stopping flights. Israel announced to retaliate.

Strategic Considerations

As we are still weeks away from witnessing the real effects of the trade wars, current shipping data suggests potentially dire consequences. It is crucial to assess your risks carefully and adjust your strategies accordingly to safeguard your assets and optimise returns.

May 5     Swiss         CPI  
May 5       Germany         Manufacturing Orders  

May 5       EU                   PMI                              

 May 5       US                   ISM Services PMI          

May 6     Global                PMI                                  

May 7       Switzerland     Foreign Exchange Reserves                         

 May 7       Germany         Industrial Orders                                     

 May 7       France             Trade Balance                                     

 May 7       Italy                 Retail Sales                                      

 May 7-8     US                 Federal Reserve FOMC Meeting                      

 May 8       UK                   Bank of England Interest Rate Decision            

 May 8       UK                   Monetary Policy Report     

May 9       China                        Trade Balance           

May 9       Switzerland     Consumer Confidence Index                         

 May 9       Japan              Household Spending                                

 May 9       Canada          Labour Force Survey                               

 May 9       US                   PPI Release                                       

Earnings:

• Monday: Palantir, Vertex Pharmaceuticals, CRH
• Tuesday: AMD, Ferrari, Arista Networks, Duke Energy, Intesa Sanpaolo, Constellation Energy
• Wednesday: Novo Nordisk, Uber, Disney, Applovin, Unicredit, Doordash, Fortinet
• Thursday: Toyota, Shopify, Mercado Libre, ConocoPhillips, Nintendo, McKesson, Enel, Rheinmetall, Siemens Energy
• Friday: Enbridge