Global Market News
Global equities made gains this week. The S&P 500 and Nasdaq increased 4.59% and 6.73%, respectively, and the Dow Jones rose 2.48% on the week. The U.S. 10-year Treasury note dropped back down to 4.24%, while the price of West Texas Intermediate crude oil declined more than 2% to end the week at $63.02 per barrel. Volatility, as measured by the CBOE Volatility Index, came down more than 20% over the week, closing Friday at 24.84.
Consumer Sentiment Drops Amid Uncertainty
In April, US consumer sentiment dropped to 52.2 from 57 in March, marking one of the lowest levels historically. This decline reflects consumer concerns about the economy, largely due to tariffs. Additionally, inflation expectations among consumers rose to 4.4% for the next 5-10 years, with a projected 6.5% increase in prices over the next year, the highest since 1981. Despite a positive week for markets, uncertainty remains as analysts caution that long-lasting damage to U.S. credibility with overseas investors has already been done.
International Developments
Pope Francis Passes Away, Conclave Awaits
Pope Francis died on Easter Monday, at the age of 88, following a stroke and heart failure, with his death confirmed by Cardinal Kevin Farrell, the camerlengo tasked with overseeing papal succession. His funeral will be held today in St Peter’s Square, led by Cardinal Giovanni Battista Re, and attended by thousands of mourners and global leaders, including Presidents Trump, Zelensky, Macron, and Milei. Departing from tradition, Francis requested a simple burial in Rome’s Basilica of St Mary Major, rejecting the Vatican crypt and elaborate coffins used by predecessors. The conclave to elect the next Pope is being prepared, with 135 voting cardinals expected to convene soon in the Sistine Chapel under updated rules allowing flexibility on the start date.
Russian Strike on Kyiv Kills 12; Trump Demands Putin Halt Attacks
On Thursday, Russia launched its deadliest aerial assault on Kyiv this year, killing 12 and injuring 90 in a massive overnight barrage involving 215 missiles and drones, according to Ukraine’s air force. In response, President Donald Trump publicly rebuked Vladimir Putin via Truth Social, writing “Vladimir, STOP!” and criticized stalled peace talks, citing 5,000 weekly battlefield deaths and setting an end-of-April deadline for progress. Despite Ukraine agreeing to a U.S.-proposed 30-day cease-fire 44 days earlier, Russia declined, demanding recognition of its 2014 annexation of Crimea and control over occupied Ukrainian territories. The U.S. peace proposal—led by Trump’s administration—would freeze current battle lines, allow Russian territorial gains, and block Ukraine from NATO, but lacks clear security guarantees for Ukraine in future conflicts.
U.S. Offers Iran Civilian Nuclear Program in Possible Compromise With Tehran
Iran and the U.S. have resumed nuclear talks in Oman, aiming to curb Tehran’s nuclear activities in exchange for lifting some economic sanctions. The U.S. has offered a civilian nuclear program as part of a potential compromise. This proposal would allow Iran to have a peaceful nuclear program, provided it stops enriching uranium, which is the main point of contention. US President Trump expressed optimism about reaching a deal, but repeated that military threats remain on the table if a diplomatic resolution isn’t reached.
US Social & Political Developments
Trump-Powell Tensions Flare Amid Tariffs and Inflation Warnings
On Tuesday, President Donald Trump reversed course by announcing he had no immediate plans to fire Federal Reserve Chair Jerome Powell, after a week of public threats over Powell’s refusal to slash interest rates further. Since September, the Fed has cut rates by just one percentage point to 4.25–4.5%, despite Trump’s push for looser monetary policy to counteract recession fears tied to his aggressive tariff measures. Investors now anticipate at least 75 basis points in additional cuts this year, even as tariffs fuel inflationary pressure, with forecasts projecting 4% annual inflation by year-end and the dollar already down 9% since February. Powell faces a credibility test as bond markets wobble, the S&P 500 drops 13%, and inflation expectations climb amid growing concerns about central bank independence.
Trump Targets University Foreign Funding with New Executive Order
On April 23rd, President Trump signed an executive order reinforcing foreign funding disclosure rules for U.S. universities, threatening to revoke federal funds from institutions failing to report gifts or contracts over $250,000. The order directs the attorney general to audit and investigate compliance, citing concerns over unreported billions—$6.5 billion discovered during Trump’s first term—and targeting Harvard specifically for greater scrutiny. Education Secretary Linda McMahon accused nations like China and Qatar of exploiting lax oversight to influence academia and steal taxpayer-funded intellectual property. Harvard, under renewed pressure to provide a decade’s worth of foreign funding records, maintains that it has complied with reporting laws for decades.
Corporate/Sector News
Apple Doubles Down on India to Supply US iPhones by End-2026
Apple Inc. confirmed plans to source most iPhones sold in the U.S. from India by the end of 2026, aiming to double local output from 40 million to over 80 million units annually. The company assembled $22 billion worth of iPhones in India in the fiscal year ending March 2025—exporting $17.5 billion worth—marking a 60% increase year-on-year. This pivot away from China, driven by tariffs and geopolitical tensions, has been accelerated by new Trump-era tariff policies and exemptions for Indian-made electronics. Key suppliers include Foxconn, Tata Group, Pegatron, and Wistron, with support from India’s state subsidies under Prime Minister Modi’s manufacturing push.
Alphabet Quarterly Earnings Announced Amid Antitrust Lawsuits
Alphabet reported Q1 2025 earnings of $2.81 per share, beating estimates of $2.01 and rising from $1.89 a year earlier, while revenue climbed 12% year-over-year to $90.23 billion, topping expectations of $89.17 billion. The earnings come amid heightened investor scrutiny over the company’s $75 billion capex forecast for 2025—up 43% from 2024—and mounting regulatory pressures both in the U.S. and Europe. The company returned to court earlier this week for final proceedings in the U.S. Department of Justice’s (DoJ) 2020 search monopoly lawsuit, which the government won in 2024 and now seeks remedies that may include breaking up parts of Google, such as its Chrome browser. A separate DoJ case concluded on April 18, with a federal judge ruling that Google had illegally monopolized online advertising technology—a decision the company plans to appeal.
Anxious Consumers Prompt PepsiCo, Others to Lower Outlooks
On April 24th, PepsiCo cut its full-year profit forecast to flat, down from mid-single-digit growth, after reporting a 1.8% drop in quarterly revenue to $17.9 billion and a 10% decline in net income to $1.8 billion. The company cited reduced U.S. consumer spending, intensified by new Trump administration tariffs—including a 25% levy on aluminum—as well as global economic uncertainty and shifting habits tied to weight-loss drugs like Ozempic. Similar concerns were echoed by Chipotle and Procter & Gamble, both of which also lowered guidance, while American Airlines pulled its full-year outlook due to declining domestic travel. In response, PepsiCo is pivoting toward lower-priced snack options and reformulating products to meet Health Secretary Robert F. Kennedy Jr.’s push to eliminate petroleum-based food dyes by 2026.
Corporate Profile
Duolingo Expands into Chess, Building on Core Language Learning
Duolingo, best known for its interactive language learning platform, offers courses in languages like Spanish, French, German, Japanese, and Chinese through gamified lessons designed to engage users. On April 24th, the company launched a beta chess course, its first new offering since adding math and music in 2023, aiming to capture the 690 million global chess players. While Duolingo’s core language services remain its largest revenue driver, analysts predict the chess expansion could add $60–$150 million in bookings by 2026. Morgan Stanley’s Nathan Feather initiated coverage on April 23 with a Street-high $435 target, citing Duolingo’s AI-driven Max tier, a 26% revenue growth forecast over five years, and potential margins of 40–50% by 2029. The stock surged 10% following the announcement and now sits just 16% below its February high, with investors eyeing its upcoming earnings on May 1st.
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BlackSummit Team
Bi-Weekly Market Update
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Source: Bloomberg
