The Week That Was, The Week Ahead: Macro & Markets, May 25, 2025
Everything to Know about Macro and Markets
Stocks clocked in large weekly declines, returning to year-to-date losses. The Dow Jones Industrial Average (DJIA) fell by 2.47%, the S&P 500 (SPX) dropped by 2.61%, and the tech-heavy Nasdaq-100 (NDX) declined by 2.39% for the week. The S&P 500 logged four straight days of losses for the first time since the reciprocal tariffs hit on April 2.
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Trade War Take 2
The technology sector was the worst performer on Friday, reversing its previous outperformance over other sectors. This followed comments from President Trump threatening 25% tariffs on Apple if the company did not shift its iPhone production to the U.S. Later in the day, the President clarified that these tariffs would apply to other phone makers as well.
Losses accelerated further after Donald Trump said in a social media post that trade talks with the European Union were going nowhere, and that he plans to impose a 'straight 50% tariff' on the bloc as soon as June 1. The EU is America's largest trading partner, accounting for nearly 20% of total trade.
And just like that, trade war fears returned to haunt the markets. The new tariff threats added to other developments weighing on sentiment, including Moody's downgrade of the U.S. credit rating, a weak Treasury auction and concerns over the surging fiscal deficit – which alone may have been overlooked by the markets, but trade policy volatility has pushed them to the surface. Last week served as a reminder that until trade deals are finalized with major trade partners, the tariff theme will continue to be a source of major uncertainty and stock-market risk.
Nuclear Renaissance
However, Trump wasn't all bad news for the stocks last week. On Friday, the President signed executive orders aimed at increasing domestic nuclear power production fourfold over the next 25 years. The orders cut down on regulations and give the U.S. Energy Secretary powers to fast-track new licenses for reactors and power plants in a bid to boost the U.S. nuclear power production. The orders will also clear a path for the Department of Energy and the Pentagon to build nuclear reactors on federally owned land.
Trump declared an energy emergency during his first day back in office, citing the fastest rise in power demand in two decades from the AI boom and data-center buildout. Traditional and renewable energy sources are already strained, while nuclear energy can alleviate the 'power hunger' without – if done right – harming the environment.
The U.S. – which once led the world in nuclear development and still has the largest capacity globally – is now being outpaced by China in nuclear power growth. After decades of over-regulation, nuclear accounts for under one-fifth of U.S. power generation. According to the administration officials and technology leaders, nuclear energy is key to winning the AI race with China. Energy Secretary Chris Wright called the race for sufficient power production 'Manhattan Project 2,' underscoring the urgency of the task at hand.
Stocks That Made the News
▣ Nuclear stocks and uranium producers, including Oklo (OKLO), NuScale Power (SMR), Constellation Energy (CEG), Cameco (CCJ), and others, surged on the news of Trump's nuclear power orders.
▣ Apple (AAPL) tumbled and its suppliers – including Qualcomm (QCOM), Qorvo (QRVO), and Skyworks Solutions (SWKS) – fell after President Donald Trump reiterated that iPhones sold in the U.S. must be domestically produced, or Apple would face a 25% tariff on imported devices.
▣ Booz Allen (BAH) plunged over 16% after its earnings call on Friday cited strong pressure on earnings from government spending cuts led by DOGE. The government contractor said that its civilian business was most impacted, while its defense and intelligence segments were doing better. BAH added fuel to the sell-off fire by revealing plans to lay off 7% of its workforce.
▣ Deckers Outdoors (DECK) dived by nearly 20% despite an earnings and revenue beat, after the company guided below Wall Street estimates for the current quarter and pulled full-year guidance, citing tariff uncertainty.
▣ Another retailer – Ross Stores (ROST) – also tumbled, losing over 10% on the week as it withdrew its previously announced full-year guidance, citing 'heightened macroeconomic and geopolitical uncertainty.'
▣ Workday (WDAY) fell nearly 12% despite a top- and bottom-line beat, as soft guidance for the coming quarter disappointed investors.
▣ Meanwhile, other software companies did much better. Intuit (INTU) popped more than 8% after beating revenue and EPS estimates and raising its full-year outlook. Autodesk (ADSK) hasn't seen strong action but was in the green for the week after it surpassed consensus and issued a second-quarter outlook that beat expectations.
Upcoming Earnings and Dividend Announcements
The Q1 2025 earnings season is drawing to an end, but many notable earnings releases are scheduled for the next few days. The main event of the week – and for many, of the current earnings season – is Nvidia's (NVDA) fiscal Q1 2026 report, scheduled to be released on Wednesday after the market closes.
Also in focus will be the quarterly results of Okta (OKTA), Salesforce (CRM), Veeva Systems (VEEV), Synopsys (SNPS), Agilent (A), Nutanix (NTNX), Dick's Sporting Goods (DKS), Costco (COST), Marvell (MRVL), Dell Technologies (DELL), and Ulta Beauty (ULTA).
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