Tuesday Afternoon Coffee - Markets Update - 27 May 2025 - Markets Surge as Trump Delays EU Tariffs; Tech, Consumer Stocks Lead Rally

The Trade Academy Team
May 26
3 min read

Markets Update: U.S. equities surged Tuesday after President Donald Trump backed off a threat to impose 50% tariffs on European Union imports, triggering a broad-based rally as investors returned from the Memorial Day break with renewed optimism.

Global Markets Roundup: 27 May 2025

The Dow Jones Industrial Average climbed 507.15 points, or 1.22%, to 42,111.45. The S&P 500 gained 91.87 points, or 1.58%, to 5,894.63, while the NASDAQ Composite advanced 373.75 points, or 2.00%, to 19,110.68, with mega-cap tech stocks driving gains.

Trump Postpones EU Tariffs, Calms Trade Jitters

Trump’s decision over the weekend to delay the EU tariff deadline from June 1 to July 9 helped lift sentiment. In a post on social media, the president said the EU had reached out to schedule meetings, calling it “a positive event.” His earlier threat to impose sweeping levies on EU goods and iPhones had rattled markets on Friday. Analysts viewed the tariff threats as a negotiating tactic.

Tech Leads Gains; Nvidia in Focus

All 11 sectors in the S&P 500 finished higher, led by consumer discretionary and information technology. Nvidia jumped 2.9% ahead of its earnings release on Wednesday, while the broader tech sector rallied as easing trade concerns fueled risk appetite. Temu-parent PDD Holdings tumbled 15.3% after posting a 47% year-over-year drop in first-quarter profit and missing revenue expectations, weighing on Chinese consumer tech sentiment.

Treasuries Rally as Yields Drop

U.S. Treasury yields fell sharply, with the 30-year yield on pace for its biggest one-day drop since mid-April, echoing a surge in Japanese government bond prices. The 10-year yield dropped 6.9 basis points to 4.44%, while the two-year yield slipped to 3.98%.

Fed officials including Minneapolis President Neel Kashkari signaled a cautious stance, advocating steady rates until the inflationary impact of tariffs becomes clearer.

Consumer Confidence Jumps

Economic data provided another boost. The Conference Board’s consumer confidence index rebounded to 98 in May, far surpassing the consensus forecast of 87. Gains were already underway before the May 12 U.S.-China tariff deal, but accelerated afterward, she added. Durable goods orders in April fell less than expected, with weakness concentrated in transportation, particularly non-defense aircraft. Oxford Economics cautioned that the broader trend remains soft amid policy uncertainty.

Commodities and Currencies Mixed; Gold Falls on Risk-On Mood

Gold slid 1.9% to $3,299.10 per ounce, as risk appetite curbed safe-haven demand and the dollar strengthened. Oil prices declined, reflecting lingering demand concerns. WTI Crude: -1.6% to $60.54/barrel. Brent Crude: -0.9% to $64.16/barrel. Natural Gas: +0.3% to $3.34/MMBtu.

The U.S. Dollar Index DXY rose 0.4%, while the euro EURUSD slipped 0.27% to $1.1356 amid soft French inflation data. The yen weakened, with the dollar gaining 1% to 144.26 yen USDJPY.

Cotton and Cocoa Climb

Cotton futures extended gains, rising above 66 cents per pound—highest since May 10—benefiting from stabilizing trade relations. Cocoa futures surged toward $9,900 per tonne amid continued supply fears.

Outlook

Markets recovered ground lost in last week’s selloff, driven by easing trade tensions and a surprisingly strong rebound in consumer sentiment. Still, investors remain watchful of U.S. fiscal risks, central bank policy signals, and the durability of the recent China-U.S. tariff truce.

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