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Weekly NewsletterMay 20, 2025

This Week on Wall Street – Week of May 19th

Markets cooled this week as investor sentiment wavered amid mixed earnings, rising bond yields, and renewed concerns over tariffs and U.S. fiscal health.

This Week on Wall Street – Week of May 19th

MARKET COMMENTARY

Markets cooled this week as investor sentiment wavered amid mixed earnings, rising bond yields, and renewed concerns over tariffs and U.S. fiscal health. The S&P 500 lost momentum after six straight gains, while tech stocks led declines. Moody’s downgrade of the U.S. credit outlook added pressure, and Treasury yields climbed, with the 10-year topping 4.5% on worries about long-term government debt sustainability.

Tariffs remained a key focus, with retailers split on the impact. Walmart warned of price hikes, prompting backlash from President Trump, while Home Depot said it would hold prices steady by shifting supply chains out of China. Target, Lowe’s, and TJX are set to report next, offering more insight into the consumer landscape. Though inflation has yet to spike, economists expect tariffs to drive price pressures later this year. JPMorgan CEO Jamie Dimon warned markets could slump as companies absorb rising costs.

Earnings and deal activity showed signs of life, with the rally broadening beyond mega-cap tech. The S&P Equal Weight Index climbed roughly 13% over the past month, though lagging sectors like energy and freight suggest uneven economic traction. M&A deals involving Dick’s Sporting Goods and Charter Communications boosted financial stocks, while China’s central bank and Australia’s central bank cut rates to cushion against global trade headwinds. Overall, investors are recalibrating as strong earnings and global stimulus are weighed against policy uncertainty, rising rates, and potential inflationary shocks. 

Economic Releases This Week

Monday: New York Fed Speaks, Fed Vice Chair Jefferson Speaks, US Leading Economic Indicators

Tuesday: Richmond Fed Speaks, St. Louis Fed Speaks, Federal Reserve Governor Speaks

Wednesday: 20 Year Bond Auction, MBA Mortgage Applications, MBA Purchase Index

Thursday:  Initial Jobless Claims, S&P Flash US Services & Manufacturing PMI, Existing Home Sales, New York Fed Speaks

Friday: Kansas City Fed Speaks, New Home Sales, Building Permits, Fed Governor Cook Speaks

Stories to Start the Week

Home Depot Plans to Keep Prices Steady Despite Tariffs

Austin’s Reign as a Tech Hub Might Be Coming to an End

EU, Britain Go Ahead With New Russia Sanctions Without Waiting For Trump

Israeli Strikes Kills Dozens in Gaza As Criticism of Israel Grows

JP Morgan Chase CEO Jamie Dimon Says Recession Is Still On The Table for US 

About This Series

Last Week on Wall Street

Last Week on Wall Street is Waterloo Capital's weekly market recap, published every Monday morning to keep advisors and clients informed on the most significant developments from the prior trading week. Each edition synthesizes equity market performance, fixed income moves, macroeconomic data releases, and notable corporate earnings into a concise, actionable read — cutting through the noise so our readers can focus on what actually matters for long-term wealth management.

Our research team tracks the S&P 500, Dow Jones Industrial Average, NASDAQ Composite, and 10-year Treasury yield as primary benchmarks, while also covering sector rotations, commodity swings, and policy shifts from the Federal Reserve and Washington. When major cross-asset moves occur — such as the historic gold selloff covered in this edition — we dig into the mechanics and the likely ripple effects on diversified portfolios, helping clients contextualize volatility without reacting impulsively.

Our Research Approach

Evidence-Based Perspective for Long-Term Investors

Waterloo Capital's investment research is grounded in fundamental analysis and long-term thinking. We believe that disciplined, evidence-based investing — anchored in each client's specific goals, risk tolerance, and time horizon — consistently outperforms reactive decision-making driven by short-term headlines. Our weekly commentary is designed to inform, not alarm: we put market moves in their proper historical context so that clients can hold conviction in their financial plans through periods of uncertainty.

As an SEC-registered investment advisor headquartered in Austin, Texas, with offices across the Southwest and Southeast, Waterloo Capital serves high-net-worth individuals, families, and institutions. Our advisors use proprietary research like this weekly recap as one input among many — alongside in-depth portfolio reviews, tax planning, and estate strategy — to deliver comprehensive wealth management tailored to each client relationship. To learn more about how our investment philosophy and ongoing market research can serve your financial future, contact our team directly.

Investment Disclosure: The information contained in this article is provided for informational and educational purposes only and does not constitute investment advice, a recommendation, or an offer or solicitation to buy or sell any security. Past performance is not indicative of future results. All investing involves risk, including the possible loss of principal. Waterloo Capital, LP is an SEC-registered investment advisor. Registration does not imply a certain level of skill or training. Please consult with a qualified financial professional before making any investment decisions.

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