Consumer Confidence Declines Amid Economic Uncertainty

On April 29, 2025, global markets are grappling with declining consumer confidence and growing concerns over a potential recession. Indices such as the GfK consumer confidence index have plummeted to -23, nearing historic lows, while Ipsos Mori’s economic optimism score has reached an all-time low of -68, indicating that only 7% of people expect economic improvement.

These declines are attributed to rising costs, recent tax tariffs, and overall economic uncertainty. Despite these challenges, business confidence remains relatively stable, with some improvement recorded due to the temporary suspension of U.S. tariffs.

Recession Fears Intensify

Economic forecasters are increasingly predicting a recession in 2025, largely due to the economic impact of newly imposed tariffs. Mark Zandi of Moody’s Analytics sees a greater than 50% chance of a global recession, warning that prolonged trade tensions could hurt sectors like manufacturing and agriculture. JPMorgan has raised its recession probability from 40% to 60%, projecting potential GDP contractions in the second half of 2025 and a spike in unemployment to 5.3%. Apollo Global Management’s Torsten Sløk estimates a 90% chance of a U.S. recession, citing the damaging effects on small businesses.

Corporate Earnings Amid Trade Uncertainties

Major corporations are reporting mixed earnings amid trade uncertainties. General Motors reported strong Q1 earnings with $2.78 EPS and $44.02 billion in revenue, beating estimates, but delayed its earnings call and guidance update due to uncertainty over auto tariffs. Similarly, UPS beat expectations with $1.49 EPS and $21.5 billion revenue but withheld its full-year outlook amid trade uncertainties. Coca-Cola also exceeded EPS expectations at $0.73 despite a 2% drop in revenue to $11.1 billion.

OPEC+ Extends Oil Output Cuts

In response to market uncertainties, OPEC+ has decided to extend deep oil output cuts into 2025. The group is reducing output by 5.86 million barrels per day, approximately 5.7% of total demand. These cutbacks include 3.66 million bpd expected to expire at the end of 2024 and an extra 2.2 million bpd of voluntary reduction by eight members, which will expire in June 2024. The extension aims to stabilize oil prices amid fluctuating demand and economic uncertainties.

OECD Projects Slower Global Growth

The OECD projects global GDP growth to moderate from 3.2% in 2024 to 3.1% in 2025 and 3.0% in 2026. Higher trade barriers and increased policy uncertainty are expected to weigh on investment and household spending. Inflationary pressures persist, with headline inflation projected to fall from 3.8% in 2025 to 3.2% in 2026 in G20 economies. However, underlying inflation is expected to remain above central bank targets in many countries in 2026.

Stock Market Overview

As of April 29, 2025, U.S. stock futures are mixed after a five-day rally in the Dow Jones and S&P 500. Dow futures are up 0.4%, while S&P and Nasdaq futures have slightly declined. Bitcoin is trading around $95,000, and 10-year Treasury yields are marginally higher at 4.23%.

In the equity markets, major indices and companies are experiencing varied performances:

• SPDR S&P 500 ETF Trust (SPY): Currently trading at $566.76, up by 1.49%.
• Invesco QQQ Trust Series 1 (QQQ): Trading at $488.83, up by 1.53%.
• SPDR Dow Jones Industrial Average ETF (DIA): At $413.04, up by 1.36%.
• Apple Inc (AAPL): Trading at $205.35, down by 3.78%.
• Microsoft Corporation (MSFT): At $435.28, up by 2.30%.
• Alphabet Inc (GOOGL): Trading at $164.03, up by 1.68%.
• Amazon.com Inc. (AMZN): At $189.98, down by 0.13%.
• Tesla Inc (TSLA): Trading at $287.21, up by 2.35%.
• Meta Platforms Inc (META): At $597.02, up by 4.42%.
• NVIDIA Corp (NVDA): Trading at $114.50, up by 2.64%.

Conclusion

The global economy is facing significant challenges as consumer confidence wanes and recession fears mount. While some sectors show resilience, the overall outlook remains cautious. Investors and policymakers will need to navigate these uncertainties carefully in the coming months.