Weekly Market Update (March 30, 2025)
- Market Hedwig
- Mar 29
- 3 min read

HIGHLIGHTS
US equities ended lower week-to-date after the rally earlier this week. It is mainly driven by the tariffs threat to Canada and EU. European equities also dropped as markets reinforced the potential impact of tariffs and concerns over economic growth. Market volatility index jumped.
Inflation: US inflation is unlikely to go away. The inflation gauge - core Personal Consumption Expenditures (PCE) price index increased slightly. Both personal income and consumer spending also increased. As markets expect Fed to keep interest rate steady in the coming meeting, plus the impact of tariffs, inflation is going to stay high for longer.
Commodity: The forecast for oil prices lowered as markets expected slower GDP growth and OPEC+’s latest decision of flexible production. Forecast for gold prices increased, driven by the expectation of continuous demand from central banks. Copper prices surpassed $10k this week after the discussion of potential tariffs on copper.
China Stimulus: Economy in China has had a great start this year. Authorities will introduce more stimulus when they see growth slow. Yuan stability is still the priority, and the officials are avoiding significant monetary easing amid the backdrop of increasing trade tensions and sluggish domestic consumption.
MARKETS
17,322.99 | -2.59% | |
S&P 500 | 5,580.94 | -1.53% |
Dow | 41,583.90 | -0.96% |
10-Year | 4.26% | +1bps |
Brent | 71.69 | +0.11% |
DXY | 104.01 | -0.13% |
*Data as of market close. 5-day change ending on Friday.
VIEW FROM THE STREET
Equity
Goldman Sachs: A basket of automakers dropped around 6.5% this week as the tariffs on autos not made in US are raised to 25%, effective on April 2. Ferrari will increase prices of their cars by up to 10%. German automakers are particularly at risk as the export volume to US is high. Meanwhile, less than 20% of General Motors and Ford's volume for the US and Canada markets is made in Mexico.
J.P. Morgan: There are two main risks in equities - stretched valuations and extreme market concentration. US equities accounted for about two-thirds of the global markets, and Magnificent Seven accounted for almost one-third of S&P500. While the policy uncertainties are weighing on US exceptionalism, investors are recommended to rebalance.
Fixed Income
Standard Chartered: USD and bond yields are expected to remain rangebound. We prefer high-yield (HY) bonds over investment grade (IG) bonds. It is because we believe the exposure to growth-sensitive bonds is more favorable than interest rate-sensitive bonds.
Goldman Sachs: We expect yields to remain unchanged in the coming months. Although tariffs have increased the downside risk to bond yields and economic growth, the spillover from global bonds is the source of upward pressure on long-end US yields.
Economy
Bank of America: Federal budget deficit hit $1.5 trillion year-to-date record. Other than defense and social spending, net interest payment is the third rapidly increasing expense. It surpassed defense spending in 2024. These 3 categories accounted for 70% of government spending.
UBS: Risks of further tariff escalation remain the main concern. However, we do not call for a recession in the US. The tariffs and counteractions are likely to lead to slower economic growth this year, but we believe the US economy will still expand by around 2% - the historical trend rate.
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DISCLOSURE
This newsletter is meant for informational purposes only and is not investment advice. Always consult a licensed investment professional before making important investment decisions. Advertising and sponsorship do not influence editorial content or decisions. Market Hedwig is not responsible for the promises made or the quality or reliability of the products or services offered in any advertisement.
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