A Willingness to Pause
May 27, 2025
.jpg "iStock-1389093478_Global Markets (2).jpg")
Equity futures are trading higher this morning, and global rates are showing signs of stabilization after a challenging week. The S&P 500 Index fell 2.61% last week,1 while the 30-year Treasury climbed to nearly 5.1% at the highs.2 Over the long weekend, President Trump delayed the implementation date of the 50% proposed tariffs on the European Union to July 9.3 Japan’s finance ministry indicated it may be open to paring back its debt issuance.4 The market has viewed this favorably as it could, in turn, leave more demand for other government debt, like U.S. Treasuries. Additionally, the French consumer price index (CPI) was cooler than expectations, which is also providing some relief to global bond yields (the U.S. 30-year Treasury is currently 4.98%).5,6
We will be watching durable-goods orders, the Federal Housing Finance Agency’s House Price Index and consumer confidence reports today.7,8 The main economic events for the remainder of the week will likely be U.S. gross domestic product (GDP) 1Q revised numbers and initial jobless claims out Thursday.9 Friday brings U.S. personal consumption expenditures (PCE) for April as well as the final University of Michigan sentiment report for May.10 In addition, the Federal Open Market Committee (FOMC) minutes will be released on Wednesday.11 Key earnings reports include Nvidia on Wednesday and Kohls, Costco and Gap on Thursday which will help investors gauge the strength of the U.S. consumer.12
Sources:
1Morningstar - Weekly Market Update: Stocks Slide, Led by Energy and Real Estate; 5/23/25
2Yahoo! Finance - Stock market today: Dow, S&P 500, Nasdaq seesaw as bond sell-off eases after House OKs Trump tax bill; 5/22/25
3NPR - Trump says he'll delay a threatened 50% tariff on the European Union until July; 5/25/25
4Reuters - Exclusive: Japan to consider trimming super-long bond issuance, sources say; 5/27/25
5Reuters - French inflation slows to 0.6% in May, lowest since 2020; 5/27/25
6CNBC – U.S. 30-Year Treasury Yield; as of 5/27/25
7,9-11MarketWatch – U.S. Economic Calendar; as of 5/27/25
8U.S. Federal Housing FHFA – House Price Index (HPI) Quarterly Report; 5/27/25
12Kiplinger – Earnings Calendar and Analysis for This Week (May 26-30)
This blog post is for informational use only. The views expressed are those of the author(s), and do not necessarily reflect the views of Penn Mutual Asset Management. This material is not intended to be relied upon as a forecast, research or investment advice, and it is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy.
Any statements about financial and company performance of The Penn Mutual Life Insurance Company or its insurance subsidiaries (each, “Client”) made by the author is provided with a written consent from the Client. Penn Mutual Asset Management is a wholly owned subsidiary of The Penn Mutual Life Insurance Company.
Opinions and statements of financial market trends that are based on current market conditions constitute judgment of the author and are subject to change without notice. The information and opinions contained in this material are derived from sources deemed to be reliable but should not be assumed to be accurate or complete. Statements that reflect projections or expectations of future financial or economic performance of the markets may be considered forward-looking statements. Actual results may differ significantly. Any forecasts contained in this material are based on various estimates and assumptions, and there can be no assurance that such estimates or assumptions will prove accurate.
Investing involves risk, including possible loss of principal. Past performance is no guarantee of future results. All information referenced in preparation of this material has been obtained from sources believed to be reliable, but accuracy and completeness are not guaranteed. There is no representation or warranty as to the accuracy of the information and Penn Mutual Asset Management shall have no liability for decisions based upon such information.
High-Yield bonds are subject to greater fluctuations in value and risk of loss of income and principal. Investing in higher yielding, lower rated corporate bonds have a greater risk of price fluctuations and loss of principal and income than U.S. Treasury bonds and bills. Government securities offer a higher degree of safety and are guaranteed as to the timely payment of principal and interest if held to maturity.
All trademarks are the property of their respective owners. This material may not be reproduced in whole or in part in any form, or referred to in any other publication, without express written permission.
