Energies
Key Takeaways:
- U.S. stock indices rose this week with expectations of potential rate cuts after cooling inflation
- The U.S. dollar fluctuated against major currencies as investors priced in a more dovish Fed outlook
- Commodities experienced volatile trading this week with oil prices stabilizing after a sharp drop on U.S.-Iran nuclear deal news. Gold prices declined over the week.
The S&P 500 rose for a fourth consecutive day on Thursday, supported by speculation that the Federal Reserve might cut interest rates if the economy weakens under trade policies. However, mixed economic data, including weaker consumer spending and continued contraction in manufacturing, limited the market gains.
Nasdaq gained 5.13% this week, getting closer to its highs from February. Dow Jones is up 1.16%, and the S&P500 is up 3.57% in total this week.
European stock markets saw gains this week as well, with Germany’s DAX up 0.7%, France’s CAC 40 rising 1.44%, and the UK’s FTSE 100 gaining 0.88%. This followed a mixed day in Asian markets.
Oil: Oil prices stabilized following a sharp drop on U.S.-Iran nuclear deal news but remained up for the week. The potential easing of sanctions on Iranian crude oil exports influenced market movements.
Gold: Gold prices saw daily fluctuations, but the precious metal was overall down for the week. The decline was due to lower safe-haven demand amid easing inflation and tariff concerns.
Major Economic Calendar Events This Week
In the United States, the Consumer Price Index (CPI) for April showed a slight decline at 2.3%, lower than expectations, which indicated cooling inflation. And on Thursday, Producer Price Index (PPI) also came lower than expected at -0.5% on a monthly basis compared with 0.2% expected figures.
Industrial Production and Housing Starts data suggested a slowdown in manufacturing and construction sectors.
The UK economy grew 0.7% in Q1 2025, its fastest pace in a year, as businesses increased investment and exports ahead of Trump’s tariffs. The growth exceeded the expected 0.6% and followed last quarter’s 0.1% expansion.
And in the Asian market, Japan’s economy contracted 0.2% in Q1, exceeding the expected 0.1% decline, with exports falling 0.6% quarter-on-quarter. While domestic demand grew 0.6%, the annualized GDP dropped 0.7%.
Year-on-year GDP grew 1.7%, the strongest since Q1 2023. The data comes amid ongoing U.S. trade talks, where Japanese companies show domestic strength but face export challenges, particularly from competitive Chinese machinery exports.
One of the major events that happened this week is Trump visiting the gulf region engaging in both business and political talks. President Donald Trump secured historical economic agreements and made strong diplomatic moves.
In Saudi Arabia, he announced a $600 billion investment commitment, and agreed to lift the U.S. sanctions on Syria, signaling a significant policy shift in the region. In Qatar, Trump oversaw a record-breaking order of 210 Boeing jets from Qatar Airways and engaged in discussions on improving U.S.-Iran relations.
Trump’s visit to the UAE featured a landmark agreement allowing the purchase of advanced American AI semiconductors and a pledge of $1.4 trillion in U.S. investments over the next 10 years.
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