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Monday Afternoon Coffee - Markets Update - 5 May 2025 - Markets Mixed as Tariff Rhetoric Weighs on Sentiment; Gold Surges Ahead of Fed Decision
- The Trade Academy Team
- May 5
- 3 min read
Markets Update: U.S. stocks closed mixed Monday as investors reacted to new trade tariff comments from the White House and an unexpected jump in services-sector growth, while the dollar weakened and gold rallied sharply.
Global Markets Roundup: 5 May 2025
Stocks Pause After Recent Rally as Trade and Services Data Clash
Equities struggled for direction, with the S&P 500 poised to break a nine-session winning streak. The tech-heavy Nasdaq fell 0.4% to 17,912.60, while the S&P 500 slipped 0.3% to 5,667.70. The Dow Jones Industrial Average edged up 0.1% to 41,353.80, lifted by gains in industrials. Most sectors declined, with energy leading the losses as oil prices tumbled. Consumer discretionary also dragged. Meanwhile, industrials and communication services bucked the trend, helping keep broader losses in check.
European Stocks Extend Rally
Germany’s DAX climbed 1.1% to 23,335, its highest level since March 18, marking a ninth consecutive gain as European equities benefited from relative calm in the region and a weaker dollar.
Treasury Yields Climb as ISM Services Surprises
The U.S. 10-year Treasury yield rose to 4.35%, extending its recent climb as April’s ISM services index showed stronger-than-expected growth, hinting at continued resilience in the U.S. economy despite global headwinds.
Dollar Slides Against Majors, Yuan Hits Multi-Month High
The dollar weakened against major peers as investors reassessed interest rate expectations and monitored developments in U.S.-China trade talks.
Offshore Chinese yuan strengthened to its highest in nearly six months at 7.1831 per dollar, as speculation grew that Beijing may allow further appreciation as part of ongoing trade negotiations.
Bitcoin Slips, Crude Drops as OPEC+ Eases Production Curbs
Bitcoin fell around 1.5%, while oil prices extended last week’s sharp losses. Brent crude declined 2.3% to $59.86 and WTI dropped 2.6% to $56.80, following OPEC+’s weekend decision to accelerate output increases. Traders also cited signals from Saudi Arabia that it was comfortable with sustained lower prices.
Gold Surges Above $3,300
Gold rallied strongly, rising 2.4% to $3,322.20 per ounce on a weakening dollar and rising geopolitical uncertainty, as investors awaited Wednesday’s Federal Reserve decision.
Soft Commodities Mixed, Grains Drop on Planting Optimism
Cotton prices slipped below 67 cents/lb after touching a one-week high last week. Cocoa eased slightly near $8,800/tonne as traders digested mixed supply signals from West Africa. Grains declined on expectations of strong planting progress and ongoing competition from Brazil:
Soybeans (ZS1!): -$0.07 to $10.51/bushel
Wheat (ZW1!): -$0.06 to $5.37/bushel
Corn (ZC1!): -8¼ cents to $4.60¾/bushel
Outlook
Markets remain sensitive to trade policy headlines and macroeconomic data surprises. With the Federal Reserve’s next decision looming, investor attention will be focused on rate guidance and inflation commentary. Meanwhile, developments in U.S.-China trade negotiations and commodity supply dynamics are likely to keep volatility elevated.
Looking forward refer to the economic calendar below to see the upcoming events scheduled for today and the rest of the week.
General news - Information source from multiple newswires.
The article and the data is for general information use only, not advice!
The Trade Academy Team
