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Weekly Market Recap & What's Ahead

19 May 2025 (recap 12 to 16 May 2025)

Market Recap

Headlines & Introduction

Markets rallied on significant easing of US-China tariffs but ended the week cautiously amid Moody's downgrade of US debt. Tech and luxury sectors initially surged, driven by AI developments and tariff optimism, but mixed macroeconomic data kept investor sentiment wary. Bitcoin maintained record-high levels despite volatility in crypto-related equities. Volatility indicators eased notably, signaling reduced immediate market anxiety despite looming economic uncertainties.

Equities

• US stocks surged sharply Monday (May 12) as US-China trade tensions eased, lifting the Nasdaq (+4.35%), S&P 500 (+3.26%), and Dow (+2.81%). Tesla (+6.8%), Amazon (+8.1%), and Apple (+6.2%) led gains (May 12). On Tuesday (May 13), chipmakers boosted the Nasdaq further, with Nvidia up 5.6%. Conversely, UnitedHealth plunged 17.8% due to CEO exit and guidance concerns. By Thursday (May 15), markets were mixed; GE rose 2.8% on Boeing deal optimism, while UnitedHealth fell another 11% on regulatory concerns.
• Europe rallied Monday (May 12), especially luxury brands like LVMH (+7.5%) and Kering (+6%). By Wednesday (May 14), luxury reversed sharply (LVMH -2.2%, L'Oreal -3.3%), amid tariff and macro concerns.
• UK equities had mixed results; FTSE 100 climbed notably on Friday (May 16) by +0.57%, supported by National Grid (+3%) and AstraZeneca despite weaker days earlier in the week due to corporate setbacks.
• Asia markets rose initially but ended weaker. Japan’s Nikkei declined on Friday (May 16) by -0.5%, impacted by weak GDP data (-0.7% YoY).

Volatility

VIX sharply declined throughout the week, marking lows unseen since early April, closing at 17.24 on May 16 (-3.3%). Short-term indicators (VIX1D, VIX9D) dropped significantly, reflecting decreased immediate fear despite Moody’s US debt downgrade.

Digital Assets

Bitcoin sustained high levels around $102,438 (May 16) despite volatility, reaching a record weekly close near $106,500. Ethereum followed Bitcoin closely but faced sharp pullbacks on May 16 due to Coinbase's (-7.2%) cyberattack news. Crypto stocks were mixed, yet Coinbase (+9%) and CIFR (+21.8%) outperformed significantly by week-end.

Fixed Income

US Treasury yields fluctuated, spiking early in the week as the 10-year reached the key psychological 4.50% on Tuesday (May 13). Moody’s downgrade of US debt triggered another surge late Friday, pushing the 30-year yield briefly to 5.0% again. German 10-year Bund yields closed at 2.59% (May 16) before weekend developments.

Commodities

Gold prices dropped early in the week amid decreased safe-haven demand but rebounded notably after Moody’s downgrade of US debt, settling around USD 3,200. Crude oil prices remained volatile yet largely range-bound, driven by geopolitical events and supply concerns, trading near USD 66 (May 13).

Currencies

The US dollar strengthened initially on tariff relief optimism but weakened significantly after the Moody’s downgrade. The Japanese yen gained strength notably, trading near 145.00 (USDJPY, May 16) following weak Japanese GDP data, signaling possible policy interventions.

Key Takeaways

• US-China tariff truce initially boosted equities but sentiment moderated post-Moody’s downgrade.
• VIX declined substantially despite ongoing macroeconomic uncertainties.
• Bitcoin maintained strong institutional support, achieving record-high weekly closes.
• US Treasury yields rose sharply on credit downgrade concerns, highlighting ongoing fiscal worries.
• Commodities exhibited mixed trends, with gold rallying post-downgrade and crude remaining volatile.

Looking Ahead (19 to 23 May 2025)

• Monday: US leading economic indicators; earnings from Trip.com, Ryanair; Fed Vice Chair Jefferson speaks.
• Tuesday: Earnings from Home Depot, Palo Alto Networks, Toll Brothers; multiple Fed speakers.
• Wednesday: Earnings from TJX, Lowe’s, Snowflake, Target; Fed Governor Bowman speaks.
• Thursday: Initial jobless claims, Existing home sales; Intuit, Ross Stores, Ralph Lauren report earnings.
• Friday: New home sales data; earnings from Booz Allen Hamilton.

Retail earnings and housing market data will provide critical insights into consumer and economic health, while Fed speakers will offer guidance amid interest rate policy scrutiny.

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Market Quick Take - 19 May 2025 Market Quick Take - 16 May 2025 Market Quick Take - 15 May 2025 Market Quick Take - 14 May 2025 Market Quick Take - 13 May 2025 Key stories from the past week

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Koen Hoorelbeke's articles on Saxo Follow and interact with me on BlueSky

Broader market sentiment eased early last week as US/China talks seemed to show progress. Shipping shares received a jolt & softening geopolitical tensions reduced support for haven assets, while equity benchmarks advanced in a risk-on move that has S&P 500 eyeing the $6000-level again. A USDJPY reversal amplified throughout the week, the UnitedHealth share-plunge continued, and President Trump made headlines securing deals in Middle east. Read more below:

The Art of the Deal – Trump in Middle East This week, Trump’s Middle East tour unlocked over $2.8 trillion in deals across; aviation, AI, defense and energy, boosting equities in those sectors. However, geopolitical volatility remains an investment risk. Oil prices also moved lower on talks of a nuclear deal with Iran. Trump's Middle East dealmaking blitz: What does it mean for investors?

Trade Truce Boosts Markets On Monday, US/China trade talks led to a significant 90-day reduction in bilateral tariffs. Markets cheered the headlines boosting equity benchmarks. The USD caught a bid until traders questioned peak pricing. Despite the risk-on shift in sentiment, markets stay cautious as the political situation remains fragile and the tariff-effect on the economy is yet to be felt. US-China trade truce only emphasizes timeless investing truths

UnitedHealth in freefall Shares of UnitedHealth plunged to a 5 year low as multiple adverse headlines hit the company throughout the week. There was a surprise resignation of the CEO while the firm also suspended 2025 guidance. This was then followed by news of a US justice department investigation into criminal Medicare fraud. How a healthcare titan lost 54% in weeks

Yen rally catching momentum USDJPY has been reversing lower this week, moving from 148.65 high to currently around 145.53 level. The move could have been amplified by recent waning of USD strength after a longer period, despite simultaneously reaching multi-month highs in long US treasury yields. John Hardy looks at the recent moves & outlines the technical picture, read more below: USDJPY reversal a green light for USD bears?

Next week’s economic data releases includes China Apr Industrial Production, EU Apr CPI (Mon), RBA Rate decision (Tues), UK Apr CPI (Wed), EU May preliminary PMIs, US May preliminary S&P Global PMIs (Thurs), German Apr GDP (Fri). Earnings highlights are Home Depot, Palo Alto Networks, Vodafone Group (Tuesday). TJX Companies, Lowe’s, Snowflake, Baidu, XPeng (Wednesday). Intuit (Thursday). A Moody’s “one-notch” downgrade of the US sovereign credit rating on Friday also made a lot of headlines which may carry into the new week.

 

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Note: this is marketing material

Learn how you can earn income or buy Bitcoin at a discount — using a conservative strategy with the IBIT ETF

Many long-term investors are curious about Bitcoin but aren’t sure how to approach it. Buying cryptocurrency directly can feel risky or overly complex. That’s where IBIT, the iShares Bitcoin Trust, comes in. It’s a regulated, exchange-traded fund (ETF) designed to give you exposure to the price of Bitcoin — in a way that fits into a regular investment account.

But what if you’d like to buy into IBIT only if the price drops — or get paid while you wait?

That’s where a simple and conservative options strategy called a cash-secured put can help.

What this strategy allows you to do

• Earn income now by committing to buy IBIT later — if it falls to a price you’re comfortable with.
• Set a clear entry point for your investment in Bitcoin — through the ETF.
• Use your cash in a more productive way than just sitting idle.

If that sounds like a fit, keep reading.

Important note: The strategies and examples provided in this article are purely for educational purposes. They are intended to assist in shaping your thought process and should not be replicated or implemented without careful consideration. Every investor or trader must conduct their own due diligence and take into account their unique financial situation, risk tolerance, and investment objectives before making any decisions. Remember, investing in the stock market carries risk, and it's crucial to make informed decisions.

The real-life example: IBIT $55 Put Option (expires 13 June 2025)

Let’s say IBIT is currently trading at $59.05.

You’re interested in owning it — but only if the price drops to $55. You could just wait and hope it gets there. Or, you could get paid now for being willing to buy it at that price.

That’s exactly what this strategy does.

• Option sold: $55 strike price
• Expiration date: 13 June 2025 (28 days from now)
• Cash required: $5,500 (to buy 100 shares at $55)
• Premium received: $124 (paid to you immediately)
• Breakeven price: $53.76

What could happen?

IBIT Price at Expiry	What Happens	Net Outcome
Above $55	You don’t buy the shares. You keep the $124 income.	+$124 return on $5,500 in 28 days (2.25%)
At or below $55	You buy 100 shares of IBIT at $55. Effective price: $53.76	You now own the ETF at a discount
Far below $55	You must still buy at $55, even if market price is lower.	Same risk as owning the ETF outright, minus the $124 income

So what exactly is a cash-secured put?

Let’s simplify the term:

• A put option gives someone else the right to sell you a stock or ETF at a specific price.
• If you sell that option, you’re agreeing to buy it — but only if the price drops.
• Cash-secured means you’ve already set aside the full amount of money needed to buy, just in case.

So you’re saying: “I’m happy to buy IBIT at $55 if it drops — and I’ll take $124 right now for making that offer.”

It’s similar to setting a limit order, but with the added benefit of getting paid up front.

Why long-term investors consider this

• You only risk buying something you want to own anyway.
• You define your entry price in advance.
• You earn income for your patience — while your cash is reserved.
• The strategy is low maintenance and works well for buy-and-hold investors.

What are the risks?

• If IBIT falls well below $55, you’re still obligated to buy it at $55.
• Your cash is tied up for 28 days, earning no other return.
• IBIT is tied to Bitcoin, which can be volatile. The premium offers a cushion, but not protection against large drops.

The table below can help clarify the financial impact of different outcomes:

IBIT Price at Expiry	Assigned to Buy?	Effective Purchase Price	Net Result
$59.00	No	–	+$124
$55.00	Yes	$53.76	$0
$50.00	Yes	$53.76	–$376
$45.00	Yes	$53.76	–$876

Frequently asked questions (FAQ)

Q: What if I don’t want to buy IBIT at all? Then this strategy isn’t for you. Only use it if you’re willing — and financially able — to own the ETF at the strike price.

Q: What happens to the premium I collect? You receive it up front, and it’s yours to keep — regardless of whether you buy the ETF later.

Q: Is this safer than just buying IBIT today? It depends on your view. You might get it at a lower price, but you might also miss out if IBIT rises and never drops to $55.

Q: Can I lose money? Yes. If IBIT drops significantly, you could face losses just like any ETF investor — although the premium slightly offsets that.

Q: What’s the worst-case scenario? You’re required to buy IBIT at $55, and its market price drops well below that. Your maximum loss is similar to owning the ETF directly, reduced by the premium you received.

Final thoughts

If you're considering long-term exposure to Bitcoin and prefer to avoid the complexity of crypto wallets or exchanges, IBIT may be a suitable option. And if you're willing to be patient — and hold cash while waiting for a better price — selling a cash-secured put offers a structured, disciplined way to enter.

You can either collect income now or potentially own the ETF at a lower price. It’s not a shortcut or a guarantee — but for the right investor, it’s a smart way to stay engaged without chasing the market.

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Crypto as a macro barometer - reading risk appetite through IBIT options The savvy trader - How to use time and volatility to your advantage Smart Investor - Long-term strategies for trading IBIT options - calls and puts Options Talk - the AI series - Episode 100 - Bitcoin 2025 analyst predictions - IBIT deep dive Smart Investor - Bitcoin in 2025 - Analyst forecasts and the IBIT ETF deep dive Market on edge - Bitcoin ETF options are making waves - here is what you need to know Guide on long-term options for strategic portfolio management

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The market worries that the current flow of copper heading towards the US ahead of the tariff announcement will be left stranded there until consumed, thereby exacerbating an already tight global market into the second half of 2025. By Q3 2025, Goldman Sachs estimates 45-60% of global reported copper inventories could be in the US, which accounts for just 6% of global refined demand—leaving the rest of the world with very low stocks of this important transition metal.

This tightness, albeit a function of trade dislocation, may in the coming months discourage new short positions driven by trade war-related growth worries from entering the market, thereby limiting the downside to the copper price through 2025.

The high-grade copper future has settled into a wide range, with USD 4 per pound having proved to offer support on numerous occasions, while the latest upside spike was mostly related to the tariff probe briefly driving the HG premium over London above 16%. In the short term, the London Metal Exchange (LME) contract offers a better insight into the global supply and demand outlook, which, according to Zijin Mining Investment Shanghai, a unit of China’s top copper miner, is currently being underpinned by the mentioned strength in China, where apparent demand growth is running near double-digit levels this year, driven by strong orders from State Grid Corp, the world’s single largest buyer of copper, and rising production of copper-intensive goods such as air-conditioning units to electric vehicles. 

Key takeaways from recent company earnings update

Copper producers are leaning into the structural tightness expected to emerge once the current surplus dissipates. 2025 guidance across the peer group points to mid-single-digit production growth and broadly stable unit costs, while almost every management team is accelerating de-bottlenecking or brownfield expansions rather than green-field megaprojects. Shareholder returns remain healthy, but CAPEX is inching higher as electrification-driven demand (AI data-centres, grid revamps, EVs) keeps long-cycle price expectations firm at or above USD 4 per pound. Political risk (U.S. tariff probe, Chile/Peru permitting), power availability and water stress are the main swing factors for 2026-28. With the supply wave cresting and demand accelerants such as AI/data-centre electrification piling on, copper-centric miners with shovel-ready brownfield growth and robust cost positions look well placed for the next leg higher.

Recent commodity articles:

7 May 2025: Agriculture markets diverge as trade war weather and speculators reshape landscape 6 May 2025: Crude climbs as market digests OPEC hike and shale slowdown risks 6 May 2025: Gold rises as Chinese demand rebounds post-holiday 5 May 2025: COT Report: Dollar-selling persists; Crude length trimmed ahead of OPEC output hike 1 May 2025: Gold corrects sharply from record highs as Chinese demand pauses 29 April 2025: Copper navigates energy transition supply shocks and market turmoil 28 April 2025: COT Report: Continued gold selling; USD weakness drives record JPY long 25 April 2025: Commodities weekly Energy slump overshadows strength in gold and agriculture 23 April 2025: Blowout top leaves Gold in consolidation mode 22 April 2025: Commodities return Why allocation matters 16 April 2025: Whats next as gold hits our USD 3300 target 15 April 2025: COT Reports show hedge funds racing to cash post-Liberation Day 11 April 2025: Commodities weekly As chaos reigns whats next for markets 10 April 2025: YouTube Interview: Gold, silver, copper, oil - prices, supply, demand in 2025 8 April 2025: Golds deleveraging pullback fails to shake supportive outlook 8 April 2025: Golds deleveraging pullback fails to shake supportive outlook 7 April 2025: COT on Forex and Commodities - April 7 2025 4 April 2025: Commodities weekly Tariff-led recession pain triggers sharp reversal 3 April 2025: Tariff-related recession fears ignite widespread commodities selloff 2 April 2025: Commodity Outlook: Commodities rally despite global uncertainty 31 Mch 2025: COT Report: Ongoing USD selling amid mixed week for commodities 26 Mch 2025: Commodities show strength in Q1, led by a select few Podcasts that include commodities focus: 6 May 2025: Bears hang in at key levels as Palantir rides the retail whirlwind 23 April 2025: Trump going soft on tariffs versus the direction of travel. 11 April 2025: US and China are slipping into an economic war 4 April 2025: Markets melts down as recession risks go global 1 April 2025: Bracing for Liberation Day