A Wild Week On Wall Street: Stock Market Recap

04/25/25

The stock market can sometimes feel like a rollercoaster, constant up and down action can make us feel like we have no clue what to expect. This week was a prime example. Major U.S. stock indexes swung sharply, starting with a steep drop and ending with a strong rally. Don’t worry if you’re not a finance expert, I will try my best to make it as simple as possible to understand. In this weekly recap, we’ll cover the biggest market-moving news from the past week, including why stocks fell early on, how they bounced back, which sectors did well and what economic signals and company earnings drove these moves. By the end of this blog, you should hopefully have a clear understanding of what happened this past week and why it matters to you.

We will dive into a day by day analysis of just what happened on Wall Street.

The week started off with all three major US stock indexes (Nasdaq, Dow, S&P 500) falling sharply. What caused the sudden drop? Two main things seemed to have caused this:

Political Troubles:

President Donald Trump blasted Federal Reserve Chair Jerome Powell, accusing the Fed of hurting the economy by not cutting interest rates. This can make investors nervous. Why? Because the Fed controls interest rates, which help control inflation, which help support the economy. A big reason why this kind of political trouble between Trump and Powell is not a good thing, is that this can lead to bad policy decisions. A public Fed feud always makes Wall Street feel uneasy.

Trade War Fears:

Keep in mind, this is all only on Monday. Now US and China trade tensions are escalating even further. There were signs that trade talks were deteriorating and concerns of new tariffs could be coming soon. Trade wars are bad for the economy, because this causes costs to rise, which dwindle down to the consumer.

This chart shows the S&P 500 (the top companies in the stock market). The rollercoaster changes it had whenever trade war announcements had been made. Stocks sank early April when tariffs were announced and when the tariff pause happened that shot back up. You can also see when Trump started talking bad about Powell on the chart stocks started going down as well. Uncertainty in the markets are not a good thing and generally will have negative effects on the stock market.

Monday's result was a broad sell-off. The Dow loss 970 points (-2.5%). The S&P fell about 2.3%, and Nasdaq lost 2.5%. Interest rates seem to be all politics at this moment as well.

After a horrific Monday, Tuesday (April 22) had a surprisingly quick rebound. Stocks bounced back strongly, recouping a big portion of the prior day’s losses. What changed investor's mood seemingly overnight? Two big factors gave the market a little optimism:

Stronger Than Expected Company Earnings:

It’s earnings season, when big companies report their quarterly profits. Several companies announced results that were better than Wall Street expected, which helped restore some confidence. For example, manufacturing giant 3M reported solid earnings, boosting its stock price. When large companies like 3M show they’re doing well, it suggests the economy might be in better shape than Monday’s panic implied.

Easing Trade War: There were hints that U.S.-China trade tensions might not worsen after all. Reports suggested that negotiators from both countries were still talking, and there was hope for a compromise on tariffs. Additionally, it appeared that President Trump dialed back some of his harsh tone. This easing of tone was taken as a good sign that the “worst case” scenario (a full-blown trade war or a Federal Reserve showdown) might be avoided.

Dow was up +2,6%, S&P +2.5%, Nasdaq +2.7%. All 11 sectors of the S&P finished higher today. Tech stocks had the highest recovery as earnings are making people more confident. Honestly the market did a complete 180 today and I was slightly shocked, nothing to crazy happening and confidence seems to be improving.

Wednesday, the stock market’s tone had clearly shifted to a more optimistic one. Wednesday (April 23) saw another strong rally, making it the second day in a row of big gains for stocks. The Nasdaq surged about +2.5% on Wednesday which is​ a sign that technology and consumer-focused companies were doing well. This is because the Nasdaq is a representative of the tech sector. The S&P 500 and Dow also rose nicely (around +1–1.7%)​. There are some reasons for this:

Tech Results:

Tech stocks went crazy today. One big story was Tesla. The electric car maker reported a 71% drop in quarterly profit, which is bad, but CEO Elon Musk was still optimistic. He hinted at focusing on the core business and cost-cutting (after a period of heavy spending). Surprisingly, Tesla’s stock jumped over 5% despite the profit plunge​. Why? Investors often care more about a company’s future plans than its past results(Which sometimes does not make sense). Musk’s reassurances and hints that he wouldn’t slash prices further helped Tesla stock. Additionally, other tech-related firms continued to shine. For example, Intel’s stock rose in anticipation of its earnings, and generally the whole semiconductor sector was strong.

Trump Chills Out:

Trump appeared to backtrack on his aggressive stance toward the Fed Chair and also on some trade threats. This made investors even more confident that cooler heads would prevail. In essence, the market perceived that the Federal Reserve’s independence was safe for now, and there were talks of easing some tariffs on China which are both very market-friendly developments.

Trade War De-escalates:

There were growing hopes that the U.S. and China might be finding common ground on trade. Mid-level officials hinted at a possible pause or rollback of some planned tariffs. Investors prefer stability, so even a small sign of truce in the trade war was enough to send trade-sensitive stocks higher. For example, major manufacturers and industrial companies (like those that rely on global supply chains) saw their stock prices rise on optimism that the “worst-case” tariff scenario might be off the table.

Wednesday seemed to solidify the rally. More positive fundamentals from stocks and less fear was in the market. Most major cap stocks had erased Monday's losses and actually are now up higher.

Thursday kept the momentum going, though overall gains were smaller, but still positive. S&P and Dow ended up 0.2%. Google leading the way.

On Tuesday evening, after market open Google’s parent company Alphabet announced its quarterly earnings. The results were very strong, they beat analysts profit expectations and showed robust growth in its advertising business and cloud computing services. What was more exciting for investors though, Alphabet talked a lot about its plans in artificial intelligence , reassuring everyone that it’s keeping up in the AI race. The next morning (Wednesday), Alphabet’s stock skyrocketed, at one point up about 9%​. This surge in such a giant company helped lift the whole market. By Thursday, Alphabet’s strong earnings were old news but still casting a positive glow, particularly on the tech sector. This is important to know as it was one of the stocks leading the way throughout the week.

Mixed Economic Data:

Thursday also brought some new data about the U.S. economy, and it was a bit of a mixed picture. On the positive side, business spending showed strength, a report on orders for capital goods rose more than expected. This suggests companies are investing for growth, which is a good sign. However, we also got news that the job market might be softening slightly. New unemployment claims ticked up to the highest level in like two years, indicating the red-hot labor market is cooling off a bit. And a separate report hinted that consumer confidence had dipped from recent highs. For investors, these weaker signals actually weren’t all bad and they potentially can take some pressure off the Federal Reserve to raise interest rates soon. But overall, the economic news was a mixed bag of some saying we are growing and others saying we are slowing.

By the end of Thursday, the market’s gains were small but kept the week’s positive momentum intact. The S&P 500 notched its third straight day of gains, and by this point the index was on track for a solid weekly advance. The heavy lifting was clearly being done by the tech sector and a few star company earnings. If you were only watching an index like the Dow, Thursday looked chill. But beneath the surface, there was a lot of action as investors repositioned their portfolios, they bought big tech gainers and sold some positions in sectors like healthcare and consumer staples.

Friday finished off the week strong. The major caps ended up and tech stocks continued to rally. Overall the three major indexes were up for the week.

Wall Street's Rally Across the Board

Most parts of the market were in the green. The S&P 500 climbed about +0.7% and even the more traditional Dow Jones Industrial Average edged up slightly (+0.05%) by the close​. The Dow’s smaller move was partly because it has more banks and industrial companies that didn’t move as much as the tech names did. But generally, investors were buying lots of stock to end the week. Traders seemed to grow more confident that the Federal Reserve’s upcoming meeting would not bring any negative surprises. There’s a Fed meeting coming up, and earlier in the week there was scare that high inflation could force more rate hikes. However, with some softer economic data and all the drama over the Fed’s independence seemingly settled down, markets were comfortable that the Fed would likely pause on any rate changes in the near term. Also, late week remarks from officials suggested some positive progress on U.S.–China trade negotiations, which further soothed one of the big worries from Monday. Basically, by Friday investors felt a sense of relief and the trade war wasn’t escalating and the Fed wasn’t going to shock them which is a nice change from the start of the week!

To summarize the week the market was fearful in the beginning to more confident during and at the end. Tech stocks soar, as well as the market as a whole. For newer investors, this is an example of why for most people it is best to just buy stock and hold onto it. Try not even look at it much, stick to large companies and the less risky options. You may have got scared and sold at the start of the week, and then would have missed out on some great gains. It is best to just hold and buy.

Sources: https://www.reuters.com/business/us-stock-futures-jump-trump-backtracks-threats-fire-fed-head-tesla-jumps-2025-04-23/#:~:text=Advancing%20issues%20outnumbered%20decliners%20by,new%20lows%20on%20the%20NYSE

https://www.cnbc.com/2025/04/20/stock-market-today-live-updates.html#:~:text=Dow%20slides%20more%20than%20950,21%2020253%3A52%20PM%20EDT

https://marketchameleon.com/

https://www.bloomberg.com/news/articles/2025-04-27/foreign-investors-face-bigger-s-p-500-nasdaq-losses-as-dollar-slides?embedded-checkout=true

https://finance.yahoo.com/news/april-jobs-report-big-tech-earnings-in-focus-amid-stock-market-recovery-what-to-know-this-week-113503429.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAAGUCbKxDW1ktEnwkAyS5pjfnWpy61tdTn3f85F5AkH7ljRPwXwLqbtTTMSO2lt_Twp96VPDknJWIFd5OKRmGs8tA6vywstoMInCe3KQ6FKV_C0_tKB-v0QIXMUucttcgZjCaFjBzoXUcT17hZ3lpxNXngs0SRXBBdBgTf6QEWVVN