Much like spring weather, storms can roll in unexpectedly, and then just as quickly, the sun returns and everything starts blooming again. That’s how the markets have felt lately. The rebound since the early-April lows has been a strong reminder that while downturns can be uncomfortable, they often clear the way for new opportunity. In my experience, staying the course, even when the skies look gray, remains one of the most reliable strategies.
Here’s what I’m seeing supporting the market’s recent improvement:
Trade Winds Are Shifting
There are some encouraging developments on the global trade front. The White House has signaled progress with several international partners, including India, South Korea, Japan, and the U.K. There’s also speculation that China may reduce certain tariffs. U.S. and Chinese officials are scheduled to meet in Switzerland this week—hopefully over strong coffee and even stronger negotiation skills.
Economic Roots Remain Firm
In April, the U.S. economy added 177,000 jobs, and unemployment held steady at a low 4.2%. Consumer spending continues to grow, and business investment was particularly strong—up more than 20% on an annualized basis in the first quarter. While GDP dipped slightly (mostly due to a surge in pre-tariff imports), I expect we’ll see a solid rebound in the second quarter.
Inflation Is Cooling, Gradually
Inflation is still hanging around—kind of like that one guest who doesn’t realize the party’s over—but I expect it to gradually trend back toward the Fed’s 2% target by 2026. Falling oil prices and lower long-term Treasury yields since January are helping move things in the right direction.
Corporate Earnings Remain Strong
Company results continue to exceed expectations. First-quarter earnings for the S&P 500 are tracking over 13% growth—more than double what many predicted. Tech companies, in particular, are continuing to invest heavily, especially in artificial intelligence, which shows their confidence in long-term innovation.
Looking Ahead
Even with all these signs of strength, the market may take a breather after such a quick recovery. Growth concerns and tariff risks haven’t vanished, and some volatility is likely. That said, I continue to recommend staying aligned with your long-term allocation across stocks and bonds. If we do see some pullbacks, they may offer more attractive entry points—like finding a quality umbrella before the next surprise rainstorm.
Markets are resilient. They trip, they recover, and over time, they tend to reward those who stick with them. One of the best examples? Warren Buffett. He just stepped down as CEO of Berkshire Hathaway after 60 years (though he’s still Chairman). His average return since 1987? An impressive 16% annually, compared to 10.9% for the S&P 500. Not bad for someone still outperforming most of Wall Street at age 94.
As always, thank you for your continued trust. I’m here to guide you through every season—whether the sun’s shining or we’re weathering a bit of rain.
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