Zorrox Weekend Update 27.4.25

Inflation Data, Trade Resilience, and Earnings Season Shake Markets: Weekly Recap

Global Headlines Drive Volatility

This past week, markets navigated a complex landscape of macroeconomic data and corporate earnings. Stronger-than-expected U.S. inflation data reshaped interest rate expectations, while China’s surprising export resilience provided a stabilizing force for global sentiment. Meanwhile, escalating tensions in the Middle East kept commodities and safe-haven assets in focus.

Macro Recap: Inflation Surprises and Trade Resilience

U.S. Consumer Price Index (CPI) figures came in hotter than forecast, shaking market confidence in an imminent Federal Reserve rate cut. Core inflation remains stubborn, forcing investors to reprice expectations for monetary easing. Across the Pacific, China delivered a positive surprise: export growth exceeded forecasts, offering a sign that global trade flows remain resilient despite geopolitical challenges.

Market Reactions: Choppy but Controlled

U.S. equities swung sharply throughout the week but ended largely flat. The S&P 500 faced volatility as real yields rose, putting pressure on growth sectors. Gold pulled back from recent highs, reacting to surging Treasury yields. Oil markets tightened, with WTI crude rallying above $85 per barrel as Middle East tensions fueled supply concerns. Bond markets saw yields spike, with the 10-year U.S. Treasury yield jumping in response to the CPI shock.

LATAM Update: Currency Stress and Central Bank Caution

Latin American currencies, notably the Mexican peso and Brazilian real, came under renewed pressure. The USD/MXN tested key technical resistance levels, driven by a stronger U.S. dollar and higher U.S. yields. Central banks in Colombia and Chile adopted a cautious tone, signaling no immediate plans to cut rates further amid lingering inflationary risks.

FX and Commodities Snapshot

Currency markets reflected growing risk aversion, with emerging market currencies under strain. Gold found support near the $2,300 mark, holding steady despite bond market turbulence. Meanwhile, oil maintained bullish momentum, with geopolitical risks and supply concerns keeping WTI elevated above $85.

Earnings Spotlight: Big Tech Results Stir Markets

Corporate earnings were mixed but influential. Microsoft exceeded expectations, reporting a 10% year-over-year revenue increase led by strong cloud services growth. Alphabet also beat forecasts, boosting its stock by over 3% as advertising revenues held firm. Tesla disappointed on earnings, reporting a 20% drop in automotive revenue; however, investor optimism over future product launches lifted the stock post-earnings.

What Traders Should Watch Next Week

• USD/MXN: Watch for a potential breakout or rejection at current resistance levels.

• Gold (XAU/USD): Sensitivity to geopolitical headlines remains high.

• Oil (WTI): Potential push toward $90 if Middle East tensions escalate.

• S&P 500: Earnings season enters a critical phase—investor focus will shift to forward guidance.

• Emerging Markets FX: Increased vulnerability if the dollar rally continues.

Advice for Traders

As volatility remains elevated, traders must stay flexible, data-driven, and attentive to both macroeconomic shifts and corporate results. Inflation surprises, trade resilience, and corporate earnings are driving rapid repositioning across asset classes. Managing exposure carefully, especially in FX and commodities, will be key to navigating the coming weeks.

Stay sharp, trade smart, and we'll see you next week with another edition of Zorrox Weekend Update.