MarketWatch for April 2025

Source: FactSet, 7 May 2025. Figures are monthly price returns in local currencies for April 2025.

April was a month of significant activity across global markets, with various regions experiencing unique challenges and opportunities. In the US, stocks faced volatility due to new tariffs, while the Eurozone saw slight gains amidst economic concerns. The UK market showed mixed results, and Japan's indices had modest positive returns. Emerging markets outperformed developed ones, and Asia ex-Japan saw varied performances. Global bonds experienced divergence, and commodities had notable movements, particularly in oil and gold prices.

US

In April, US stocks experienced significant volatility following President Trump's announcement of "Liberation Day" tariffs on 2 April. These tariffs included a 10% rate on all imports along with punitive “reciprocal” tariffs, which were far broader and larger than expected. However, most of the reciprocal elements of tariffs were suspended for 90 days, allowing stocks to recover.

The US economy contracted by 0.3% in the first quarter, and inflation fell to 2.4% in March from 2.8% in February. Energy stocks were the weakest due to lower oil prices, while consumer staples and technology stocks performed the best.

Eurozone

Eurozone stocks were slightly positive in April. Similar to the US, energy was the weakest sector, while consumer staples and utilities outperformed. The eurozone economy grew by 0.4% in the first quarter, according to Eurostat. The European Central Bank cut interest rates by 0.25% due to concerns over the US tariffs, indicating a deteriorating growth outlook.

UK

UK stocks were slightly weaker in April, with energy stocks lagging and utilities performing the best. The domestically focused index outperformed the internationally focused one. Inflation fell to 2.6% in March, down from 2.8% in February. Public borrowing was £14.6 billion higher than expected for the year ending in March.

Japan

In Japan, the Topix index had a small positive return, while the Nikkei 225 gained 1.2%. Japan began priority tariff negotiations with the US following "Liberation Day," although no deal was concluded by the end of the month. Many Japanese companies announced share buybacks, significantly exceeding last year's record levels.

Emerging Markets

Emerging markets outperformed developed markets in April, aided by a weaker US dollar. Mexico was the top performer as it faced no new tariffs on "Liberation Day." Brazil and India also performed well, supported by local currency strength and easier monetary conditions. South Africa benefited from record-high gold prices. Conversely, China and Turkey saw significant losses due to trade tensions and economic issues.

Global Bonds

There was a marked divergence within global government bond markets. In the US, the Treasury prices for short-term bonds rose while longer term prices fell due to weak economic data. In Europe, yields fell (prices rose) across eurozone markets and UK gilts. The European Central Bank cut rates again, signalling increased growth uncertainty. Asian government bond yields fell in line with European markets, and Chinese manufacturing data showed impacts from US trade tensions. 

Commodities

Crude oil prices fell in April due to concerns over trade tariffs and increased OPEC supply. Gold prices hit a new high as investors sought safe havens amid market volatility. The agriculture component also gained, with cocoa and coffee prices posting strong advances.