Market Momentum: Weekly Financial market briefing – 28/04/2025

Week in Review: 22^nd-25^th of April

Maybe, just maybe we are waking up and realising it was all just a bad dream. Last week started well with Donald Trump saying he had no intention of firing Jerome Powell, then there were conciliatory tones from the White House suggesting they will walk back on the effective trade embargo on China. China also responded positively with a reduction of tariffs on US goods. Corporate earnings have been solid, there were big gains in the tech sector, and global share markets were firmly positive. US bond yields edged lower and the dollar strengthened. The FTSE 100 had another good week and is building a notable daily winning streak.

Observation of the Week:

With investors tariff-ied, talk of upcoming recession risks and the highest level of volatility since COVID, you might think it would be a bad time for ETF product issuers. Financial product innovation has shown no signs of letting up as ETF providers continue to mint new products at a fast clip according to analysis by Bloomberg Intelligence.

63 new ETFs have come to market so far in April. So far for the year we have seen an average of 75 new ETF launches per month versus 59 last year and 40 in 2023. Many of these new strategies involve high degrees of complexity as volatility is inspiring an interest in more exotic products and leveraged plays for short term traders. Although there are still plenty of lower risk and more vanilla global index and bond products coming to market, leveraged single stock, both long and short, and cryptocurrency ETFs are becoming the trend. Where there is an appetite amongst investors, there will be a product provider stepping in to meet it.

U.K. Market Performance

The FTSE 100 booked a 1.69% gain for the week, its second positive week in a row, now up 5.66% over the fortnight. It is the best two weeks since the vaccine developments in November 2020. The index was lifted by stronger than expected UK retail sales and cautious optimism over easing trade tensions.

FTSE 100 Movers

Gainers: Croda International +10.9%, Antofagasta +9.9%, Babcock International +8.7%, Intermediate Capital +7.3%, Weir Group +7.1%, Standard Chartered +6.7%

Losers: Endeavor Mining -6.8%, Reckitt Benckiser -5.1%, Fresnillo -4.5%, Hiscox -4.5%, Legal & General -3.7%, Marks & Spencer -3.6%, DCC -2.8%, Beazley -2.8%

Macroeconomic Data

Production: The Flash UK PMI Composite Output Index fell to a 29-month low of 48.2 in April, compared with 51.5 in the previous month and the consensus of 50.4. The manufacturing PMI dropped to a 20-month low of 44 from the prior month’s 45.3, in line with expectations. The services PMI reached a 27-month low of 48.9, against the previous 52.5 and the estimated 51.3. The Confederation of British Industry’s monthly net balance of new factory orders improved to a five-month high of -26% in April from -29% in March, beating the consensus of -35%. However, the reading still pointed to an overall contraction in industrial demand, with manufacturers pessimistic over costs and global economic conditions. The export orders index deteriorated to -41% from -29%.

Government Debt: The UK budget deficit has exceeded official forecasts after just one month. The ONS reported a £151.9b deficit against the upwardly revised £137b forecast from the Office for Budget Responsibility. Crimping any fiscal headroom Rachel Reeves thought she may have had.

Bank of England Commentary: BoE Governor Bailey: “It’s not just the relationship between the US and the UK, it’s the relationship between the US, the UK and the rest of the world that matters, because the UK is such an open economy,” he said. “I’ve said a number of times, fragmenting the world economy will be bad for growth.” On the fall from grace of the US dollar, Bailey said “I think a lot of talk about reserve currency status is overdone”. BoE policymaker Megan Greene said tariffs would be disinflationary as cheap goods are rerouted to the UK. Markets expect a quarter point rate cut in May to 4.25%. Analysts are starting to pencil in a greater probability of further rate cuts for the rest of the year.

Retail Sales: UK Monthly retail sales grew 0.4% in March after a 0.7% increase in February, according to the ONS. Expectation was for a 0.4% fall for the month.

On a yearly basis, UK retail sales edged up 2.6%, against the revised prior-month figure and consensus forecast of a 1.8% gain. Indicating a slightly more resilient British consumer.

Trump said he has no plans to fire Powell. Tesla jumped amid revelations Elon’s dalliance with politics is coming to end. A softer stance on tariffs coming from the White House with Scott Bessent suggesting punishment on China may be wound back. Donald Trump sounded a peaceful tone on the back of ‘talks’, that never occurred according to the Chinese Communist Party, regardless, hope springs eternal. China has also responded peacefully, mulling plans to cut tariffs on the US.

Another week, this time a positive one for US stocks, albeit another flip flop on policy further entrenching uncertainty. Strong tech sector earnings also spurred on positive moves for US markets.

S&P 500 Movers

Gainers: Microchip Technology +21.2%, Palantir +19%, Servicenow +18.2%, Hasbro +17.7%, Discover Financial +17.3%, Equifax +17.2%, Tesla +17%

Losers: Fiserv -15.4%, Erie Indemnity -13.2%, UnitedHealth -13.1%, Northrop Grumman -10.7%, T-Mobile -10.4%, LKQ Corporation -10.3%, Aon -10.2%

Beige Book: The “Beige Book,” formally titled the “Summary of Commentary on Current Economic Conditions,” is a report published by the Federal Reserve Board traditionally printed on a beige-coloured paper. It painted a ‘darkened’ outlook of the US economy, with the theme of uncertainty coming up regularly, and the word tariff used 107 times compared to 50 times in trade war one. Analysts saw it as a ‘pre downturn’ assessment of the current economic picture.

Trade Talks: Bessent advised an “agreement of understanding” may be reached shortly with South Korea, Rachel Reeves is in Washington for talks and negotiations with Japan are ongoing. All eyes on further movement on Sino-American relations given the conciliary tones from both camps late last week.

US Chicago Fed National Activity Index fell to -0.3% in March down from +0.24% in February indicating a contraction in growth.

Interest Rates: Investor sentiment was supported by hopes of a potential Federal Reserve rate cut, after Cleveland Fed President Beth Hammack indicated that a move could come as early as June if economic data warrants it.

US durable goods orders increased more than expected in March, buoyed mainly by robust demand for commercial planes, government data showed.

US existing home sales decreased more than expected in March as prices reached a record high for the month, according to National Association of Realtors data.

Notable Corporate Earnings

Tesla kicked off Tuesday with a terrible set of numbers. EPS coming in more than 30% below expected and Q1 profit and revenue down on last year. However, the stock surged on the prospect that Elon’s time is up at DOGE and he will be returning his attention to the helm of his embattled company.

Aerospace & Defence: Continues to be a hot sector as a ramp up in global military spending along with aging commercial airline fleets are keeping the sector airborne. GE Aerospace jumped after beating expectations, as airlines extend the life of older planes, boosting parts demand. RTX rose on an 8% EPS beat, while Lockheed Martin climbed after strong missile sales, continuing backlog of demand and reaffirmed guidance. Boeing, despite posting a loss, rallied 4% as management reassured the market about shifting aircraft deliveries away from China.

Tech & AI: In tech, Alphabet surged 12%. Google’s parent company posted upbeat numbers easing investor concerns as the hefty AI spend is rewarding shareholders. Interestingly, the Gemini AI summaries in the search engine has not eaten into advertising margins. ServiceNow rose 14% after strong government sector demand, easing concerns about budget cuts. However, it wasn’t all good news: IBM dropped 9% despite beating on earnings as software growth disappointed, and Intel fell 7% after missing Q1 expectations and issuing a weak outlook.

Telecoms had a mixed week. AT&T gained 3% after reaffirming its 2025 outlook and posting a rise in subscribers, but Verizon slipped 3% as subscriber losses widened, especially in postpaid phone contracts. T-Mobile fell despite a marginal EPS beat, with subscriber growth coming in softer than hoped. Competitive pressures and consumer churn are clearly intensifying across the sector.

Healthcare stocks showed a picture of health, although tariff concerns are growing. Boston Scientific recorded a strong beat and guidance raise, while Danaher promised to offset tariff impacts through supply chain tweaks. Intuitive Surgical, however, dropped 6% after warning tariffs could weigh on future results. Merck gained on solid numbers but cut its guidance due to slower sales of key drugs. AbbVie rose slightly, while Bristol Myers Squibb slipped after underwhelming guidance. Overall, the sector remains steady but cautious.

Consumer goods were under pressure as cost headwinds build. Philip Morris rallied 5% after a strong beat and upgraded outlook, powered by growth in its smoke-free business, which now makes up 42% of revenue. In contrast, Procter & Gamble fell 2% after sales missed expectations and it trimmed its 2025 guidance, citing tariffs and market volatility. PepsiCo also dropped 4% following a miss and a lowered forecast due to rising costs and softening consumer sentiment, while Colgate-Palmolive edged up 1% after a reasonable result but flagged cost inflation concerns.

Financials: Chubb rose 1% after a resilient Q1 despite catastrophic losses from the LA fires, showing strength in premiums and investment income. Fiserv beat on earnings but slumped 5% as investors worried about slowing growth in its Clover point-of-sale operations and a dip in payment processing as consumer spending cooled

The Open: Monday 28^th April

With the FTSE 100 up around 0.4% at the open, we are now seeing an 11-day winning streak, the UK’s longest winning streak since 2019. The German Dax and French CAC opened around 0.5% higher. The Australian ASX 200 kicked off the week higher, the Japanese Nikkei, Hong Kong’s Hang Seng and Mainland China’s Shanghai Composite have all started the week slightly lower. Bitcoin is up, Gold is down, and Dow, S&P 500 and NASDAQ futures are slightly down as at 10am GMT.

Week Ahead: 28^th April to 2^nd May 2025

Market Themes to Watch

1. Headline driven week ahead (again) – Will more news emerge of a back down between the world’s two largest economic superpowers, will we get more drama, or will something break? Currently, Donald Trump’s ire seems to be back on Russia as opposed to trade.
2. Trade Negotiation progress – There is confusion as to the progress on US-China talks. Some in the Trump administration are saying they are talking to China everyday, which is news to Beijing. Treasury Secretary Scott Bessent says he has not discussed tariffs with Chinese officials and cannot confirm if Trump has spoken to Xi. The White House expects to have trade talks with six countries per week up until the deadline on tariffs, which is a tall order.
3. Corporate Earnings – A big week of earnings ahead, with some major UK companies issuing quarterly updates and 181 out of the S&P 500 reporting in the U.S. In what has been a relatively solid earnings season to date, the names reporting this week represent about 40% of S&P 500 market cap, including Microsoft, Amazon, Apple and Meta.
4. Supply Shock – As tariff consequences start to take hold, American consumers are set to experience shortages in the breadth and volume of goods. We could soon see COVID era empty shelves, high prices and panic buying as cargo into the US from China has dropped 60%.
5. China Stimulus – China’s Politburo said it would “fully prepare” emergency plans in response to the trade war. State media also reported they may set up new monetary tools and policies to boost technology, consumption and trade.

Upcoming Economic Data – U.K.

Retail Activity: CBI Distributive Trades survey (Monday)

Property Market: Nationwide Housing Prices Index, month on month and year on year (Wednesday)

Bank of England: Consumer Credit, M4 Money Supply, Mortgage Approvals, and Mortgage Lending (Thursday)

Upcoming Corporate Earnings

UK Companies: HSBC, Barclays, Lloyds, NatWest, Standard Chartered, AstraZeneca, GSK, Associated British Foods​, BP & Shell

Major UK banks will release earnings amid concerns over the impact of recent US tariff announcements and global recession risks. HSBC and Standard Chartered, with significant Asian exposure, may face headwinds, while domestically focused banks like NatWest and Lloyds could show resilience. Barclays may benefit from added trading revenues due to volatile markets. Pharmaceutical companies AstraZeneca and GSK will provide updates on drug pipelines and global sales. Associated British Foods’ results will offer insights into consumer goods demand and cost pressures. Global political impacts on international operations, credit risk provisions, lending growth, pharmaceutical innovation, and consumer demand trends in the UK will be watched by investors.

Upcoming Economic Data – U.S.

Economic Growth: GDP Growth Rate (Wednesday)

Inflation: Core PCE Price Index (Wednesday)

Labour Market: ADP Employment Change, Employment Cost Index (Wednesday), Initial Jobless Claims (Thursday), Non-Farm Payrolls & Unemployment Rate (Friday)

Production: Dallas Fed Manufacturing Index (Monday), Dallas Fed Services Index (Tuesday), Chicago PMI (Wednesday), S&P Global Manufacturing PMI, ISM Manufacturing PMI & New Orders (Thursday)

Trade & Inventories: Goods Trade Balance, Retail Inventories ex Autos, Wholesale Inventories (Tuesday)

Property Market: House Price Index, S&P/ Case-Shiler Home Price Index (Tuesday), Pending Home Sales (Wednesday)

Notable Corporate Earnings

Energy: Exxon Mobil, Chevron, BP, Shell​

Energy giants Exxon Mobil, Chevron, BP, and Shell are set to report amid falling oil prices and ongoing discussions about energy transition strategies. The risk of global recession has seen oil prices fall dramatically at the same time over potential increases of supply from OPEC. Investors will look for updates on production levels, capital expenditures, and approaches to sustainable energy investments.

Technology, AI & Semiconductors: Microsoft, Amazon, Apple, Qualcomm, Cadence Design Systems, NXP Semiconductors, Teradyne, F5, Atlassian, Cognizant Technology, eBay, Garmin, MicroStrategy​

Tech giants Microsoft, Amazon, and Apple are set to report, with investors keen on AI integration, cloud services growth, and hardware demand. Semiconductor firms like Qualcomm, NXP Semiconductors, and Teradyne will provide updates on chip demand across various industries. Enterprise software companies Atlassian and Cognizant Technology will offer insights into corporate IT spending.

Consumer Goods & Services: McDonald’s, Starbucks, Mondelez, Coca-Cola, Kraft Heinz, Yum! Brands, Domino’s Pizza​, Spotify, Airbnb, Booking Holdings

Consumer-focused companies like McDonald’s, Starbucks, and Yum! Brands will offer insights into fast food trends and consumer spending behaviour. Packaged goods companies Mondelez, Coca-Cola, and Kraft Heinz will report on demand elasticity amid inflationary pressures. Domino’s Pizza’s earnings may reflect shifts in at-home dining preferences. Streaming service Spotify will provide updates on subscriber growth and content investments. Airbnb and Booking Holdings’ reports will shed light on travel demand and booking trends in the hospitality sector.

Healthcare and Pharmaceuticals: AstraZeneca, Pfizer, Eli Lilly, Amgen, Cigna Group​

Pharmaceutical leaders Pfizer, Eli Lilly, and Amgen will report earnings, highlighting drug pipeline developments and responses to biosimilar competition. Cigna Group’s results will provide a view into healthcare insurance trends and cost management.​

Financial Services: Visa, Mastercard, PayPal, Robinhood, MetLife, Prudential Financial, Apollo Global Management, S&P Global, Intercontinental Exchange, Cboe, T. Rowe Price​

Payment processors Visa, Mastercard, and PayPal will report on transaction volumes and digital payment adoption. Robinhood’s earnings will indicate retail trading activity levels. Insurance firms MetLife and Prudential Financial will discuss underwriting results and investment income. Asset managers Apollo Global Management and T. Rowe Price, along with market infrastructure providers S&P Global, Intercontinental Exchange, and Cboe, will provide perspectives on capital markets health.

Industrials & Transports: Caterpillar, Honeywell, UPS, General Motors, Eaton Corporation​

Industrial bellwethers like Caterpillar and Honeywell will provide insights into global machinery, manufacturing demand and supply chain dynamics. UPS’s earnings will shed light on parcel volumes, e-commerce trends and logistics efficiency. General Motors’ report is anticipated to reveal the initial impact of trade uncertainty, EV investments and consumer demand shifts. Eaton Corporation may offer perspectives on electrical infrastructure spending amid the energy transition.

DISCLAIMER This article is for information purposes only and no part of it or its contents are deemed to be nor should be taken as advice. It does not constitute recommendations to buy or sell any securities mentioned. Past performance of investments is no guide to future returns and you may get back less than you invested. Capital at Risk.

Middleton Private Capital Adaptable. Active. Transparent.

With over 40 years of experience managing investments for private and institutional clients, Middleton Private Capital delivers expert, highly personalised portfolio management that offers real value, not vague promises.

Our Edge: We Don’t Outsource. We Outperform. Unlike most wealth managers who delegate investment decisions to third-party fund managers, we stay in control. That means every investment is selected by us, giving us the power to adapt quickly to shifting markets, and to build portfolios that are as individual as your needs.

Adaptable

We don’t follow rigid models or benchmark-chasing strategies. Our flexible, bespoke approach allows us to respond to ever-changing market conditions and to your unique goals. No generic portfolios. Just intelligent, responsive investing.

Active

We aim to outperform markets, not just track them. Through hands-on portfolio management, led by in-house research and selective external insight, we make every investment decision count, always aligned with your risk appetite and preferences.

Transparent

We invest directly in shares and bonds, using funds or derivatives only when essential. You’ll always know what you own, why you own it, and how it’s performing, line by line. With clarity comes accountability, and we take that seriously.

Who We Work With

Private Clients – High net worth individuals, business owners, retirees and their families.

Professional Clients – Institutional investors, pension schemes, IFAs, accountants and legal professionals.

Looking for clear, confident investment management or a second opinion on your portfolio? Let’s talk.

Middleton Private Capital Ltd is authorised and regulated by the Financial Conduct Authority, No. 804197. Middleton Private Capital Ltd is registered in England and Wales, No. 11148660. Registered Office: Cavendish House, Welbeck, Worksop, Nottinghamshire, S80 3LL.

Middleton Private Capital (Head Office) Cavendish House Welbeck, Nottinghamshire S80 3LL Telephone: 01909 261071 info@middletonprivatecapital.co.uk

Middleton Private Capital (London Office) 8 St James’s Square London SW1Y 4JU London Office: 020 3137 5121 info@middletonprivatecapital.co.uk