Greetings from the Rock Cut Investment Group!

Stocks staged a late month-end rally to end one of their wildest-ever months. The S&P 500 ended the month down -0.8% and the tech-heavy Nasdaq gained +0.9%. The month of April was marked by some of the largest stock declines the markets have seen since the Covid-19 pandemic (Wall Street Journal 5/1/25). We believe the main reason the markets have recovered include the 90-day pause on “reciprocal” tariffs. The U.S’s reciprocal tariffs are on pause until early July 2025, though 10 percent universal tariffs are still in effect, as are 25% tariffs on steel, aluminum and autos (with special carve-outs). Bonds recovered nicely in the month of April and provided further justification for a diversified investment portfolio, in our opinion.

It is amazing the resilience of the markets despite the amount of uncertainty that currently exists. We continue to believe that tariffs, in their current state, will be not be permanent. Tax reform is hoping to be signed into law before the 4th of July, per people within the Trump administration. Components of the proposed tax reform have yet to be announced.

Global Insight Monthly – May 2025:

RBC’s views on asset classes, the economy, and timely issues that impact investment strategy.

• “Imbalancing” act – The U.S. has been running up debts to buy foreign goods. This is not sustainable in the long term, but we do not see an easy escape for the U.S. from the trade imbalances that have been created over the last four decades.
• Global equity: Either/or … – For now, our investment policy remains set at “invested but watchful.”
• Global fixed income: Seeing through the fog – The tariffs and trade war are causing uncertainties for the future. We look through the fog and focus on rates, central banks, and what might come next for markets and investors.

Click here for the full report.

From the “Personal” File:

Matt, Natalie and Addyson celebrated Easter in Florida visiting Natalie’s parents.

As always, let us know if you have any questions!