Equity Markets Closed Lower on Trade Uncertainty

Stocks tumbled last week as traders contemplated the potential impact of new legislation and increased trade tensions following President Trump’s threat of new tariffs against the European Union and Apple. While stocks declined, long-term bond yields rose, with 10-year Treasuries reaching a three-month high of 4.64% last Thursday before settling at 4.51% by the end of the week. New tariffs also impacted the dollar index, which fell to its lowest level in two weeks. With investors moving away from risk, gold prices climbed higher.

Existing-Home Sales Fell for Second Consecutive Month

Existing-home sales slid 0.5% in April for the second straight month and retreated 2.0% from one year ago. The median existing-home sales price rose 1.8% from April 2024 to $414,000, an all-time high for the month of April and the 22nd consecutive month of year-over-year price increases. The inventory of unsold existing homes represented a 4.4-month supply at the current monthly sales pace, up from 4.0 months in March. Sales of existing single-family homes fell 0.3% in April and declined 1.4% over the last 12 months. The median existing single-family sales price was $418,000, 1.7% above the price in April 2024 ($411,100). Inventory of existing single-family homes for sale rose from 3.8 months in March to 4.2 months in April.

Eye on the Week Ahead

The second estimate of first-quarter gross domestic product is available this week. The initial estimate showed the economy contracted 0.3%. Also, out this week is the Personal Income and Outlays report for April. Consumer spending rose 0.7% in March, while consumer prices were unchanged from the prior month.