Equities Rally, bonds catch a bid, and investors shift focus to Earnings and fed signals.
After a jittery close last week, markets came back from the long weekend with renewed optimism. The threat of steep U.S. tariffs on European imports had briefly rattled investors, but a pause in escalation helped reset the tone. With the tariff timeline pushed out to July, equities found their footing early Tuesday, and risk appetite returned across the board.
The S&P 500 rose 1.5%, with the Nasdaq 100 and Russell 2000 outperforming at 1.93% and 2.11%, respectively. European markets also rallied, with Germany’s DAX notching a new intraday high. Meanwhile, bond yields moved lower as investors rotated into fixed income, and the dollar firmed up—likely a reflection of both safe-haven demand and shifting rate expectations.
Interestingly, metals sold off sharply. Gold dropped over 2%, while copper and silver also declined. That move suggests a pullback in defensive positioning, as investors leaned back into equities and away from commodities that typically benefit from uncertainty.
But the calm may be temporary. The week ahead is packed with catalysts: Nvidia’s earnings on Wednesday will be a key test for the AI trade, and the Fed’s meeting minutes—along with the April inflation data—could reshape expectations for monetary policy. Durable goods orders also came in weaker for April, which may reflect early signs of pressure from recent trade policy shifts.
From my perspective, this week is less about the relief rally and more about what comes next. The market is clearly sensitive to geopolitical headlines, but it’s also hungry for clarity on growth, inflation, and earnings. With so many moving parts, staying nimble and data-driven is going to be essential.
Stephen Coleman – head market strategist at stipelis