Below is a summary of some of the relevant news items from the Capital Markets and the Economy from the past week extracted from RBC Global Insights and FactSet Research.
You can catch up on the past four weeks’ Weekly Update in the link to my Blog.
Read my latest Smart Investor newsletter on my website. The Q1 2025 edition covers Market Review for 2024, a discussion about the main themes for 2025, and some long-term multi-decade trends. In Shiuman’s Corner find out what my favourite books were from last year.
Markets
Market scorecard as of close on Friday April 25th, 2025.
| Country | Equity Indices | Level | 1 week | YTD |
| Canada | S&P/TSX Composite | 24,711 | 2.1% | -0.1% |
| U.S. | S&P 500 | 5,525 | 4.6% | -6.1% |
| U.S. | NASDAQ | 17,383 | 6.7% | -10.0% |
| Europe/Asia | MSCI EAFE | 2,460 | 2.9% | 8.8% |
Source: FactSet
- TSX ended slightly lower in Friday afternoon trading, off worst levels. Canadian equities closed higher in Thursday afternoon trading, near best levels. TSX had a third straight weekly gain, recovering 2,000 points from April lows.
- US equities closed mostly higher in Friday trading, ending near best levels and seeing major market indices cap strong weekly gains. Treasuries were firmer, but came off session's best levels. 30-year Treasuries back moved below 4.75%.
- U.S. stock indexes took their direction from the changing White House rhetoric during the week. After a 2.4% decline in the S&P 500 Index on Monday, the market regained 6.0% through Thursday at 2 p.m. Eastern time. The initial decline was driven by unconfirmed weekend news reports that President Donald Trump wanted to fire Federal Reserve Chair Jerome Powell for not cutting interest rates in the face of tariff inflation. Continued tough talk on tariffs also spooked investors.
- But by Tuesday, sentiment improved as the administration appeared to pivot on the more worrisome policies. The walk-back of the Powell firing comments came after interventions from Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick, who warned that such a move could trigger far-reaching market upheaval and a messy legal fight, according to The Wall Street Journal.
Economy
Canada
- Canadian consumer spending has gradually softened, in line with Statistics Canada’s preliminary estimates for February. In RBC Economics’ view, the current average 3.6% tariff rate imposed by the U.S. on Canada is unlikely to be severe enough to send the Canadian economy into a recession.
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RBC Economics believes there is room for fiscal policy to ramp up to further support the economy should it weaken more significantly than it expects. The BoC would likely need to see an accumulation of disappointing growth figures, with stable inflation, before policymakers would resume their monetary easing campaign, according to RBC Capital Markets.
U.S.
- The hardline tariff stance gave way as Treasury Secretary Scott Bessent, speaking at an investor conference, revealed that the standoff with China was unsustainable in his view, and that he expected the situation to de-escalate.
- The positive reaction to this fading of the tariff war headwinds wasn’t limited to equities; similar rebounds were seen in the value of the dollar and in bond yields (see chart). This suggests to us the pivot may lead to a more durable period of relative market stability.
Further Afield
- Thailand’s exports grew for a ninth consecutive month in March, jumping 17.8% y/y to US$29.5 billion, surpassing January’s 13.6% and February’s 14% increases. The strong growth likely reflected front-loading demand before U.S. tariffs come into effect. Exports to the U.S., Thailand’s largest market, soared 34.3%, while exports to China rose 22.4%.
- Japan’s Services Producer Price Index rose 3.1% on a yearly basis in March, slightly exceeding economists’ 3% consensus estimate. The data highlights persistent inflationary pressure in Japan, reinforcing the Bank of Japan’s case for future rate hikes once economic uncertainties subside.
Notes About Companies in Model Portfolio
- Earnings season kicked into high gear during the week, with 30% of the companies in the S&P 500 having reported by midday Eastern time Thursday. A combination of actual results and consensus forecasts suggests 4% y/y average sales growth and 9% earnings growth for the quarter, led by banks and some Industrials-sector companies, while the spillover effects from policy uncertainty seem to be most pronounced for consumer-facing names.
- Procter & Gamble (PG) reported third quarter fiscal year 2025 net sales of $19.8 billion, a decrease of two percent versus the prior year. Organic sales, which excludes the impacts of foreign exchange and acquisitions and divestitures, increased one percent versus the prior year. Diluted and core net earnings per share were $1.54, each an increase of 1% versus prior year.
- Waste Connections, Inc. (WCN) announced Wednesday its results for the first quarter of 2025. Revenue of $2.228 billion, above outlook and up 7.5% year over year. Net income of $241.5 million and adjusted EBITDA of $712.2 million, above outlook and up 9.5% year over year.
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Regards,
Shiuman
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