{"id":2774,"date":"2025-06-10T18:05:21","date_gmt":"2025-06-10T16:05:21","guid":{"rendered":"https:\/\/talentagestion.es\/informe-mensual-de-mercados-mayo-2025\/"},"modified":"2025-06-10T18:13:04","modified_gmt":"2025-06-10T16:13:04","slug":"informe-mensual-de-mercados-mayo-2025","status":"publish","type":"post","link":"https:\/\/talentagestion.es\/en\/informe-mensual-de-mercados-mayo-2025\/","title":{"rendered":"Monthly Market Report \u2013 May 2025"},"content":{"rendered":"\n

In May, stock markets continued their recovery<\/strong>, experiencing significant increases<\/strong>. The main driver was the trade agreements announced by the Trump Administration<\/strong>, especially the one reached with China in mid-month<\/strong>. Meanwhile, bonds performed poorly<\/strong> (especially U.S. Treasuries), with long-term benchmarks reaching yield levels that led to increased investor nervousness<\/strong>.<\/p>\n\n\n\n

May began with a surprising GDP figure in the United States<\/strong>, taking the country’s growth into negative territory (-0.3% from the previous +2.4%<\/strong>). The figure was completely distorted by the performance of the external sector. Imports rose sharply in an effort to avoid future tariffs<\/strong>, which resulted in a negative external balance contribution<\/strong> to GDP calculation. It is expected that next quarter’s figure will offset this effect.<\/p>\n\n\n\n

Meanwhile, the U.S. Congress approved Donald Trump’s tax reform bill<\/strong>. This will imply a significant tax cut<\/strong>, leading the U.S. Treasury to collect USD 3.8 trillion less over the next 10 years<\/strong>. The reform is still pending approval by the Senate.<\/p>\n\n\n\n

Also in the U.S., another major highlight was the credit rating downgrade by Moody\u2019s on U.S. public debt<\/strong>. The credit rating agency downgraded U.S. debt by one notch (from Aaa to Aa1)<\/strong>. Moody\u2019s was the last agency to maintain the highest rating<\/strong> for U.S. debt. The market reaction was limited, far from the sharp declines in bonds and equities seen years ago when S&P and Fitch made the same move.<\/p>\n\n\n\n

The U.S. Federal Reserve (Fed) held its third meeting of 2025 in May<\/strong>. The institution led by Powell kept interest rates unchanged at 4.50%<\/strong>, as expected by the market. The Fed focused on the potential negative impact of Trump\u2019s tariffs<\/strong> and their repercussions on growth and inflation. Powell explicitly stated that the Fed is in no hurry to cut rates<\/strong>.<\/p>\n\n\n\n

All of the above led to rising yields on U.S. debt in May (falling prices)<\/strong>. 10- and 30-year benchmarks reached maximum yields of 4.62% and 5.15%, respectively<\/strong>. There is a reduced global demand for long-term sovereign debt<\/strong>, especially from countries such as the U.S. and Japan.<\/p>\n\n\n\n

Regarding equities, most indices posted significant gains<\/strong>. The S&P 500 rose by +6.15%, marking its best May since 1997<\/strong>. Indices such as the Nasdaq rebounded by +9.04%<\/strong>. Both indices now show positive year-to-date returns in 2025 (+0.51% and +1.56%, respectively)<\/strong>, thus fully recovering from the sharp declines seen in March and early April<\/strong>.<\/p>\n\n\n\n

U.S. equities remain weighed down by the \u201cMagnificent Seven\u201d in 2025<\/strong>. In addition, the performance gap in favor of European equities remains<\/strong>, staying around 9%<\/strong>.<\/p>\n\n\n\n

Markets welcomed the conciliatory tone of the Trump Administration and its efforts to reach trade agreements with other countries<\/strong>. On the weekend of May 10\u201311, China and the United States met in Switzerland<\/strong> to advance trade negotiations. The result was better than initially expected<\/strong>, as all tariffs on China were extended for 90 days, automatically reduced from 145% to 30%<\/strong>, a factor that was widely celebrated by markets<\/strong>.<\/p>\n\n\n\n

During the last week of May, Trump shifted to a more aggressive tone in trade policy<\/strong>, with the following key developments:<\/p>\n\n\n\n

On Friday, May 23, Trump surprisingly announced a new 50% tariff on Europe<\/strong>. That same weekend, following a phone call with Ursula Von der Leyen, those tariffs were completely suspended<\/strong>.<\/p>\n\n\n\n

On the last day of May, Trump directly accused China of not complying with the Swiss trade agreement<\/strong>.
Finally, a new source of uncertainty emerged late in the month regarding tariffs<\/strong>. The U.S. International Trade Court declared many of Trump\u2019s tariffs illegal<\/strong>, including the reciprocal ones announced on \u201cLiberation Day,\u201d April 2<\/strong>.<\/p>\n\n\n\n

However, the following day, the Washington Court of Appeals temporarily suspended the ruling<\/strong>. The Trump Administration is expected to present its defense on June 9<\/strong>. If the ruling is upheld, Trump still has numerous alternative tools to impose new tariffs<\/strong>, albeit with less flexibility.<\/p>\n\n\n\n

In a separate matter, the conflict between Russia and Ukraine appears far from resolved<\/strong>. Recent Russian attacks violating the ceasefire have heightened geopolitical tensions<\/strong>. Trump accused Putin of \u201cplaying with fire\u201d and threatened sanctions against Russia<\/strong>.<\/p>\n\n\n\n