Please see below article received from Brooks Macdonald this morning, which provides a global market update for your perusal.
What has happened
US megacap technology shares had another good day yesterday. Nvidia was up +4.16%, pushing the ‘Magnificent Seven’ technology group of companies’ share prices (Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla), up +1.75%. Elsewhere however, there was some investor buying fatigue creeping into markets after the rally over the past few weeks, with the equal-market-capitalisation-weighted version of the US S&P500 equity index down -0.62%. Over in Europe, without megacap tech to fall back on, the pan-European STOXX600 equity index was down -0.24%, while overnight Asian equity markets are a touch lower also (all in local currency price return terms).
UK economy stronger than expected in Q1
UK Gross Domestic Product (GDP) data for calendar Q1 is out this morning – the data shows the UK economy has been doing better than expected, growing at +0.7% in Q1 2025 versus Q4 2024. That is an acceleration from the +0.1% GDP growth rate in Q4 2024 versus Q3 2024 and was above forecasts looking for +0.6% in Q1 2025. Furthermore Q1 2025 was the strongest quarter-on-quarter growth rate since Q1 2024. That said, keep in mind that while GDP numbers are always backward-looking, perhaps this is even more the case currently given how US President Trump’s 2 April tariffs are reshaping the global economy more broadly.
Middle East geopolitics
There are news reports overnight that Iran is willing to sign an agreement around concessions for its plans for making nuclear weapons in return for a lifting of US economic sanctions. Specifically, Ali Shamkhani (an adviser to Iranian Supreme Leader Ayatollah Ali Khamenei) has confirmed that Iran would conditionally agree to limit future uranium enrichment to lower (sub-weapons grade) levels consistent with civilian energy generation use. That better geopolitical outlook is helping to push back on Brent crude oil prices, down -3% today currently at around US$64 per barrel – for context, those oil prices are well off their $80+ per barrel 2025-year-to-date highs back in January (as an aside, as we have written about before in our Daily Investment Bulletins, keep in mind that lower oil prices, if sustained, can have a material dampening impact on any inflation pressures elsewhere).
What does Brooks Macdonald think
This morning’s UK GDP data is more difficult than usual to extrapolate. Aside Trump’s 2 April tariff plans where the recent UK-US trade deal leaves 10% universal tariffs largely in place, the domestic UK economic picture is somewhat tougher now given the hike in employer National Insurance costs that came into effect last month. The Bank of England’s latest economic projections arguably reflect that picture, with UK GDP growth expected to effectively stall in calendar Q2, with an estimated growth rate of just +0.1%.
Please check in again with us soon for further relevant content and market news.
Chloe
15/05/2025