Morning Brew May 12 2025

Good morning,

On Friday, equities were trading calmly, making it one of the quietest weeks in a long time. However, this week starts very interestingly: optimism on trade talks between the US and China and possible peace talks between Ukraine and Russia boost risk sentiment. While there is so far little clarity on either news, they are perceived as positive at the moment.

Donald Trump also announced he would sign an executive order to substantially limit the price of medicine, advocating it as the most important message he has sent. He states that medicine in the US should be as cheap as in the cheapest country.

Equities open positively: the GER40 breaks to new highs, the US Tech 100 NAS breaches the 200-day moving average, the US500 is just now testing it, oil and silver trade positively while gold recedes. US 10-year yields jump to 4.38, EURUSD falls to 1.1225, GBPUSD to 1.3275, and USDJPY to 146.10. Gold falls 1.5% to 3273 while silver rises to 32.90. The XAUXAG ratio falls below 100. Ethereum can add almost 7% to 2500, and Bitcoin is trading at 104000.

As we speak, the GER40 is at 23730, US500 at 5744, and the USTECH100 NAS at 20470. Asian shares are positive. China's car sales rose 14.8% in April.

While there are some important data points like US CPI and retail sales this week, I expect news to be the decisive factor – can the positive sentiment carry on? This will depend on news out of the White House, trade negotiations, and the possible meeting between Zelensky and Putin. Especially the news from Geneva is void of details, as both sides say the talks were constructive, but as was to be expected, there is no tangible outcome and the tariffs remain in place.

With the new German government in place, a lot of attention will be on Friedrich Merz's performance.

Trade carefully and manage your risk, as there can be sharp moves at any point in time, and it can go either way. We are at key technical levels in many financial instruments, and technical trades can strengthen moves.

Monday, May 12

- Japan Trade Balance

- U.S. Federal Budget (April)[

- Fed Governor Adriana Kugler speaks

Earnings: Hertz,

Tuesday, May 13

- Germany ZEW

- U.S. Consumer Price Index (CPI) & Core CPI (April): Key inflation data

- NFIB Small Business Index (April

Earnings: JD.COM, Honda, Under Armor,

Wednesday, May 14

- Germany Inflation (HICP)

- San Francisco Fed President Mary Daly speaks

Earnings: Sony, Tencent, Cisco,

Thursday, May 15

- UK GDP

- EU GDP

- U.S. Retail Sales (April): Important consumer spending data & Initial Jobless claims

- Fed Chair Jerome Powell speech: Closely watched for monetary policy signals

Earnings: Walmart, JohnDeere,

Friday, May 16

- EU Trade Balance,

- US House Prices & University of Michigan Sentiment