April Market Recap
Where do we start? April gave us what felt like a year’s worth of market activity crammed into 30 days.
The major stock benchmarks finished lower for the third month in a row, although a marginal loss for the S&P 500 was hardly indicative of the most volatile month in five years. Not since the COVID-19 pandemic has panic gripped Wall Street the way it did in April.
Fortunately, the early month turbulence led eventually to calmer waters and equities ended April close to where they began; an incredible feat given the S&P 500 at one point was down nearly 14% from its March 31 close.
Only five of 11 sectors in the S&P 500 finished higher last month, and only two gained 1% or more (Technology: +1.6%, Consumer Staples: +1.1%) Energy (-13.7%) sank heavily as oil prices fell to 4-year lows. HealthCare (-3.8%) also underperformed.
Benchmark Returns: April 2025 | YTD 2025
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Dow Jones
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S&P 500
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NASDAQ
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-3.17% | -4.41%
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-0.76% | -5.31%
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+0.85% | -9.65%
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|---|
As Donald Trump walked toward the podium in the White House Rose Garden on April 2, investors had no idea what was about to happen. While Trump long ago made it clear he favors tariffs as a foreign policy tool, the size and scope of tariffs he announced on “Liberation Day” were far greater than expected. In total, 60 countries were suddenly subject to tariffs of varying severity, with China – the world’s second-largest economy – topping the list at 84%.
Financial markets were caught entirely off-guard. In the first full day following the tariff announcements, the S&P 500 sold off 4.8%. When markets closed on April 8, the S&P 500 had lost more than 12% in only four trading days. The NASDAQ fell 13.3% over the same period and the VIX Volatility Index closed above 50 for the first time since the COVID-19 pandemic.
Bond yields, meanwhile, spiked higher. The 10-year US Treasury yield moved from 4% to nearly 4.6% in a week, a seismic shift by bond standards. It’s unusual to see Treasury yields climbing higher when economic concerns are rising, and the strange trend caused some to wonder whether foreign governments who own hundreds of billions in US debt (like China) might be selling “out of retaliation.”
With markets in a panic, President Trump on April 9 announced a 90-day pause to the implementation of all reciprocal tariffs. Stocks immediately rocketed higher. In one day the S&P 500 gained 9.5% and the Dow soared nearly 3,000 points. Volatility remained elevated in the final three weeks of April but stocks found their footing and moved generally higher. By April 30, the S&P 500 had risen 15% from its low.
With tariff uncertainty likely to slow consumer spending and hinder economic growth, expectations rose for the Federal Reserve to step in and cut interest rates. The problem is that rate cuts could rekindle inflation, an outcome the Fed is determined to avoid.
Fed Chair Jerome Powell has preached patience with rate cuts, although future employment reports could force his hand if the labor market weakens. The Fed seems unlikely to cut rates following its May 6-7 meeting but cuts in June and/or July are realistic. Powell, by the way, was harshly criticized by Trump in April although the President later said he has no intention of firing the sitting Fed chair.
Nearly half the companies in the S&P 500 had reported Q1 earnings by the end of April. Led by strong profits in the Tech sector, blended earnings are on track to grow 10% from a year earlier, but the bigger focus has been on forward guidance. Numerous companies have opted to avoid sharing any formal guidance whatsoever, citing the uncertainty created by on-again, off-again US tariff policies.
Without a clear long-term economic policy from the White House, corporate spending has been dialed back. Recession odds have increased dramatically and we may already be halfway there given that US Gross Domestic Product (GDP) contracted by 0.3% in the first quarter.
Consumer sentiment continues to crater. The University of Michigan survey fell for the fourth month in a row.
International stocks again outperformed in April. Non-US Developed equities gained 3.7% last month. Emerging Markets rose 0.1%. Small-cap stocks, as measured by the Russell 2000, fell 2.4%.
After their mid-month spike, 10-year US Treasury yields ended April at 4.18%, down slightly from a month earlier. West Texas Intermediate Crude oil finished the month trading below $59 per barrel, its lowest price in four years.
Ben Marks
Chief Investment Officer
Brett Angel
Senior Wealth Advisor
Investment Advice offered through Marks Group Wealth Management, a Registered Investment Advisor.
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Past performance is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
The Standard & Poor’s 500 Index is a capitalization weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.
The NASDAQ Composite Index measures all NASDAQ domestic and non-U.S. based common stocks listed on The NASDAQ Stock Market. The market value, the last sale price multiplied by total shares outstanding, is calculated throughout the trading day, and is related to the total value of the Index.
The Dow Jones Industrial Average is comprised of 30 stocks that are major factors in their industries and widely held by individuals and institutional investors.
Russell 1000 Growth Index measures the performance of those Russell 1000 companies with higher price to-book ratios and higher forecasted growth values.
Russell 1000 Value Index measures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.
The Russell 2000 Index is an unmanaged index generally representative of the 2,000 smallest companies in the Russell Index, which represents approximately 10% of the total market capitalization of the Russell 3000 Index.
MSCI EAFE Index consists of the following developed market country indices: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, and the United Kingdom.
The MSCI Emerging Markets Index is a free float-adjusted market capitalization index that is designed to measure equity market performance of emerging markets.
VIX-The Chicago Board Options Exchange’s CBOE Volatility Index, a popular measure of the stock market’s expectation of volatility based on S&P 500 index options. It is calculated and disseminated on a real-time basis by the CBOE, and is often referred to as the fear index or fear gauge.
