Weekly Market Update – August 4, 2025

Price Return Last Week

S&P 500 (2.3%)     S&P Mid Cap (3.5%)   Russell 2000 (4.2%) 

MSCI EAFE (3.1%)   MSCI EM (2.5%) 

10 Yr US Treasury Rate – fell from 4.39% to 4.22%

Source: Refinitiv Eikon

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Recent News

Tariff News – On Friday, President Trump announced increased tariff rates between 10% and 41% on dozens of countries, set to begin in seven days.  Canada will see a 35% duty on many items, 50% for Brazil, 25% for India, 20% for Taiwan, and 39% for Switzerland amongst others.  Mexico was granted a 90-day extension before facing higher tariffs to allow for more time to negotiate a trade deal.  Prior to the announcement of increased tariffs, Commerce Secretary Howard Lutnick announced trade deals with Cambodia, South Korea, and Thailand but didn’t state the tariff rates that each country would face.  Earlier in the week Trump ordered a 50% tariff on many copper imports with a few exclusions.

Source: Thomson Reuters, The Wall Street Journal

Fed Decision – As expected, the Federal Reserve kept interest rates at the same level between 4.25% and 4.5%.  For the first time since 1993, multiple Fed governors voted against the decision.  Both recommended lowering rates by a quarter-point.  While Fed Chair Jerome Powell noted “we do see downside risk in the labor market,” he also commented that the impact of tariffs is “still quite early days” and “we’re just going to have to watch and learn.”  Odds of an interest rate cut at the next meeting in September were at 45% following the Fed meeting.

Source: The Wall Street Journal

Jobs Reports – Jul: 73k (Reuters Poll est. 110k) Jun: 14k

Two days after the Fed Chairman said he saw “downside risk in the labor market”, the jobs report showed signs of weakening in the labor market.  While the number of jobs added in July fell only slightly below expectations, the number of jobs added in May and June were revised sharply lower.  Total revisions for May and June lowered the number of jobs added by 258,000.  The weak report caused the market to price in a higher likelihood of an interest rate cut in September, with odds of a cut surging from 45% to approximately 90%.

Source: Refinitiv Eikon, The Wall Street Journal

Trump Fires US Labor Department Statistician – Citing inaccuracies in the jobs report without evidence, President Trump fired the commissioner of the U.S. Bureau of Labor Statistics.

Source: Thomson Reuters

GDP – Q2: 3.0% (Reuters Poll est. 2.4%) Q1: -0.5.%

A significant drop in imports boosted second quarter GDP above expectations.  While trade subtracted 4.6% from the annual GDP change in Q1, Q2 showed trade adding 5.0% to the annual GDP print this quarter.  This highlights the volatile nature of the country’s trade market.  Compared to the end of 2024, both exports and imports have declined, signaling a potential end to the era of globalization.  Personal consumption remains solid, increasing from 0.5% last quarter to 1.4%.  This was partially offset by a decline in domestic investment, which fell to (3.0%) from 3.9%.

Source: Bureau of Economic Analysis

Bar None – The Tales of the Cocktail Foundation announced the annual winners of their Spirited Awards on July 24 with Chicago-bar, Kumiko, taking home the top prize for World’s Best Bar.  Kumiko is founded by Julia Momose, a former bartender from the Aviary and Oriole, and features both alcoholic and non-alcoholic cocktails with a nod to Julia’s upbringing in Japan.  This is the first time in the 19-year history of the award that a Chicago-based bar has won the top prize.

Source: NBC Chicago, Tales of the Cocktail Foundation, StarChefs

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Upcoming Events

8/4 – Notable Earnings Reports: ONEOK, Vertex Pharmaceuticals, Palantir

8/5 – ISM Non-Manufacturing PMI, Notable Earnings Reports: DuPont, Molson Coors, Caterpillar, Yum! Brands, Archer-Daniels-Midland, Broadridge, Cummins, Pfizer, Zoetis, Aflac, AMD, Amgen, Arista Networks, Match Group, Super Micro Computer

8/6 – Notable Earnings Reports: Walt Disney, Global Payments, McDonald’s, Uber, Fortinet, McKesson, MetLife, Occidental Petroleum, Airbnb, DoorDash

8/7 – Notable Earnings Reports: Becton Dickinson, Warner Bros Discovery, Eli Lilly, ConocoPhillips, Vistra, Constellation Energy, Akamai, Expedia, Gilead Sciences, Monster Beverage

Source: Refinitiv Eikon