Weekly Market Update: May 6–12, 2025

Markets Rally Amid Tariff Truce

Global markets experienced a notable upswing this week following a significant development in U.S.-China trade relations. The two nations agreed to a 90-day reduction in tariffs, with the U.S. lowering duties on Chinese imports from 145% to 30%, and China reducing its tariffs on U.S. goods from 125% to 10% . This agreement spurred investor optimism, leading to substantial gains across major stock indices. ¹ 

• S&P 500: Closed at 5,679.65 on May 9, up from 5,605.87 on May 6 . ²

• Dow Jones Industrial Average: Rose by 1,160 points, marking a significant recovery . ³

• Nasdaq Composite: Exited bear market territory, reflecting renewed confidence in the tech sector .

The tech industry, in particular, benefited from the easing of trade tensions, with companies like Amazon seeing a 7.4% increase in stock value . ⁴

Bond Yields and Commodities

The yield on the 10-year U.S. Treasury note increased to 4.45% by May 12, indicating investor anticipation of potential economic growth .

In commodities:

• Gold: Prices experienced volatility, closing at $3,324.59 on May 9, down from $3,431.49 on May 6 . ⁵

• Oil (WTI): Prices rose to $61.95 per barrel on May 12, the highest in two weeks, driven by optimism over the trade agreement . ⁶

Currency Movements

The U.S. dollar strengthened against the euro, with the exchange rate moving from 0.879 on May 6 to 0.903 on May 12 .⁷ 

Economic Indicators

While the tariff agreement has temporarily alleviated some economic concerns, underlying challenges persist. Analysts have adjusted recession forecasts, reducing the likelihood from over 50% to 35%, and have revised inflation expectations downward . ⁸

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Investor Takeaway

The temporary easing of U.S.-China trade tensions has provided a boost to global markets, particularly benefiting sectors reliant on international trade. However, the 90-day nature of the agreement means that uncertainties remain. Investors should stay informed and consider the potential implications of future trade negotiations on market dynamics. ⁹

1.  https://markets.businessinsider.com/news/stocks/markets-sp500-dow-nasdaq-us-china-trade-tariff-talks-switzerland-2025-5?utm_source=chatgpt.com ↩︎
2.  https://finance.yahoo.com/quote/%5EGSPC/history/?utm_source=chatgpt.com ↩︎
3.  https://www.marketwatch.com/livecoverage/stock-market-today-dow-s-p-500-nasdaq-futures-set-to-soar-on-u-s-china-trade-hopes?utm_source=chatgpt.com ↩︎
4.  https://www.barrons.com/articles/amazon-stock-price-microsoft-google-meta-mag-7-5d16b392?utm_source=chatgpt.com ↩︎
5.  https://www.usagold.com/daily-gold-price-history/?utm_source=chatgpt.com ↩︎
6.  https://www.reuters.com/markets/commodities/oil-prices-rise-us-china-trade-talks-soothe-market-jitters-2025-05-12/?utm_source=chatgpt.com ↩︎
7.  https://wise.com/us/currency-converter/usd-to-eur-rate/history?utm_source=chatgpt.com ↩︎
8.  https://www.investopedia.com/recession-fears-fade-after-tariff-deal-11733377?utm_source=chatgpt.com ↩︎
9.  https://www.businessinsider.com/us-china-trade-deal-agreement-slash-trump-tariffs-2025-5?utm_source=chatgpt.com ↩︎