Morning Brew April 25 2025

Good morning,

Markets continue to calm as there is little new fuel for the fire. If this continues will largely depend on any news from the Whitehouse. The economic agenda is thin and would allow for a quiet day:  UK Retail Sales at 8  and the University of Michigan consumer confidence at 1600 the only important releases today.

• Reuters reports, China is considering to exempt some U.S. imports from it`s tariffs. This is a signal that the two countries are looking to calm the situation.
• US Durable Goods orders came higher than expected but this may have been due to pre-Loading before the tariffs took effect.
• Russia attacked Ukraine with missiles and drones yesterday , killing at least 12 peoplecausing Donald Trump to lash out against Russia
• Apple announced plans to source all phones for the US market in India from 2026

Indexes traded higher: the Dow +1.2%, the S&P 500 2.%, the Nasdaq 2.74. The GER40 is trading at 22130, up 5% from a week ago.

While Google could shine (see below) , but Procter & Gamble PepsiCo Chipotle Mexican Grill and American Airlines all cut or withdrew forecasts due to elevated uncertainty among consumers. Volumes on US exchanges  were below the average at 14 billion shares

US 10 Year Yields are at 4.3% and the USD Index at 99.75, EURUSD 1.1340, GBPUSD 1.3290 and USDJPY 143.66. Gold and Silver are trading at 3315 and 33.50.

John wrote on the USD yesterday:  The US dollar has backed up sharply as the market hopes that the Trump administration is ready to make deals. But is the market over-playing the situation? In any case, the USD snapback rally does improve the risk-reward for USD bears, even if two-way volatility risks remain.

Jacob on Alphabets earnigs: Google delivers strong results: total revenue rose 12% to USD 90.23 billion, comfortably beating Wall Street estimates of USD 89.1 billion. Even more impressive was profit growth—net income surged by a remarkable 46% year-over-year to USD 34.54 billion, translating to earnings per share (EPS) of USD 2.81, far exceeding analysts’ consensus of USD 2.01.

• AI and Cloud lead the way: Alphabet's strong earnings reflect significant growth driven by AI innovations and improved profitability in its Cloud division and strong Ad revenue
• Tariffs and regulation as risks: Upcoming tariff changes and regulatory rulings pose potential challenges and could impact advertising revenues and market position.
• Investor confidence reinforced: Alphabet continues rewarding shareholders generously through dividends and share buybacks, underscoring confidence in its long-term financial strength.

Trade safely and have a great weekend.