World Stocks Poised for Best Month Since 2023 Amid Trade Jitters
Equity markets worldwide are experiencing their most significant monthly gains since 2023 despite investors waiting for U.S. inflation data and ongoing trade tensions under President Donald Trump.
The MSCI main world index has risen above 5% in May because of declining fears about Trump's tariffs despite a short federal court block of his extensive levies which the higher court later restored. European stock prices recovered from their initial decline on Friday to reach a 0.8% gain while U.S. futures declined before the Federal Reserve released its PCE index data.
The dollar stands near its first positive monthly performance of 2025 because Treasury yields increased following a successful bond auction.
However, concerns persist. The U.S. could impose taxes of up to 20% on foreign investments through a little-known provision in Trump's budget bill which has sparked concerns about stagflation when inflation remains high while economic growth declines. Brown Brothers Harriman strategist Elias Haddad described the tax proposal as alarming because it could reduce global capital movement.
Equity investors maintain positive sentiment because they believe inflation data indicates a possible interest rate reduction in the second half of the year. The combination of mixed economic conditions and trade policy uncertainties keeps markets highly responsive to both new data releases and political news headlines.
Dominic Maley is an American journalist recognized for his sharp and insightful reporting on social and political issues. His work is known for its depth, integrity, and the ability to highlight critical societal concerns.