Insights Weekly Research Briefing

If the news flow was a drop of water then this week we would be looking at a raging waterfall. Even more appropriate then that we came across this shot of the largest volume waterfall in the Americas which sits on the American/Canadian border. For most of us who live in the states, the tariff decision between the two countries needs to be reached this week as it will affect our future cost of cars/trucks, electricity and maple syrup.

Don't worry, you won't be the only one taking those calls from outside the office this week. With summer in full swing and a light economic calendar on deck, many market participants will be listening to those earnings calls from anywhere else but an office building.

Rise and shine investors because you have seen this day before. Most of you are planning on starting the morning off with a big breakfast TACO. A few of you are readying yourself for a bowl of mush and a glass of Postum. Either way, the White House is back to demanding extremely high tariffs once again on all foreign imported goods. With the stock market trading back to its previous high valuation, it is saying that the new tariff rates will not make it to August 1st.

Joining this year's July 4th nighttime festivities will be the U.S. financial markets which after difficult March and Aprils, rebounded to the sounds of a John Philip Sousa march. Count me as surprised to see US stocks at all-time highs, credit spreads near 20-year lows and US Treasury yields near 20-year lows.

The summer weekend began with a major geopolitical event on Saturday. As of now, we do not know if this event will add or subtract a risk factor to the financial markets. While we are hopeful that the weekend strikes will be a one-time event that will cause an increase in peace for the Middle East, it is up to Iran to decide its next move.

Believe it or not, the back half of 2025 is rapidly approaching. While we choose our line to get the portfolio ready for the last six months, the news stream continues to flood the zone with information both important and meaningless. While the motherboards in the servers with the trading algorithms are near meltdown, as long term investors, we can take a slower and more observatory approach. So what are the markets telling us right now?

Where we are now is that stocks continue to recover and point to better days ahead. The equity market recovery has provided a new window for tapping the risk markets either via an IPO, secondary or selling debt. And given the reception to the deals, investors want to put money to work.

The inexpensive foot coverings are great for summer strolling and poolside patio navigating, but they are not ideal for path hiking or street running. Equally put, White House tariff flip flopping could be good for some short-term traders, but the lack of certainty is not helpful for long term investors or managers of any sized business.

While the kids get in the water, U.S. stocks emerged from their 2025 dunking as the S&P 500 moved into positive territory last week. Global stocks bounced 4-5% as the world lowered their recession forecasts and raised their earnings estimates and price targets post a White House retreat on China tariffs.

While Washington was distracted this weekend by a used Boeing 747, Treasury Secretary Scott Bessent took over the U.S. economic control room and lowered all China tariffs back to a 10% + 20% level.

Time to find out if the American people really believe in shared sacrifice. It's one thing for your simple Christmas tree to have fewer dolls or toys underneath it this December.

Investors are hoping that the stormy April markets will also lead to some blossoming in their May portfolios. US investors in European equities have seen many of their assets bounce back to highs, especially in German stocks and among the European financial companies.