Stocks rose again this week with major US indices now relatively flat year-to-date, but still below their all-time highs reached in February.
Markets around the world rallied Monday on the news that US and China trade representatives agreed to lower their tariffs for 90 days while a broader trade agreement could be negotiated. US tariffs on Chinese goods were cut from 145% to 30%, while Chinese tariffs on US goods were cut from 125% to 10%.
Also lifting market sentiment, President Trump’s visit to the Middle East saw a number of announced business deals and economic commitments from Saudi Arabia, United Arab Emirates (UAE), and Qatar.
“But the message was clear: the Gulf states want to be first in line when it comes to partnering with the U.S., whether it be for business, military, or tech.”
https://www.cnbc.com/2025/05/16/trumps-middle-east-trip-saudi-arabia-qatar-uae-go-all-out.html
On the economic front, retail sales were weaker in April after a strong March, but still a little better than expected. Also, the Producer Price Index (PPI – wholesale, or business inflation), unexpectedly fell in April, consistent with an environment of cooler inflation.
Over the summer we expect the media focus to shift to the debate in Washington over extending the 2017 tax cuts. It’s impossible to know how this will play out, given President Trump’s unpredictability. Last week he urged Speaker of the House Mike Johnson to raise taxes on the wealthy.
Have a great weekend.
Jack C. Harmon II, CFP®, CIMA
Principal, Harmon Financial Advisors
Registered Principal, Raymond James Financial Services
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