Mid-Week Wrap-Up - April 30th, 2025

Negative GDP, a weakening labor market and rising inflation sends markets lower

AuthorAuthor

CMG Venture & Mark Roussin
April 30, 2025

Good morning investors!

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This report is designed to help investors of all skill levels break down important stories/topics within the stock market. And best of all, we cut through all of the BS and give you exactly what you need to know in easy to digest, bite sized pieces of content.

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Market Talk

The major indexes are mixed to start the week on the heels of tough economic news.

3 Stories Moving the Market

These are some of the biggest stories so far this week that are having an influence on market action.

U.S. economy shinks in the first quarter as Trump policy uncertainty weighs on businesses

The U.S. economy unexpectedly contracted in Q1 2025, with GDP falling -0.3% as businesses rushed to import goods ahead of President Trump’s sweeping new tariffs. While one-off factors like the import surge weighed on the quarter, early signs of weakening consumer demand and slower hiring suggest deeper risks may be emerging under the surface.

🔑 Key Points

  • GDP fell -0.3% vs. +0.4% expected — first decline since Q1 2022

  • Imports spiked +41%, subtracting over 5 points from GDP

  • Consumer spending slowed to +1.8%, down from +4%

  • Equipment investment jumped +22%, likely ahead of tariffs

  • Core PCE (GDP) rose +3.5% QoQ, inflation remains sticky

  • Headline PCE was flat MoM in March, with YoY cooling to +2.3% (vs. 2.2% est.)

  • Core PCE was flat MoM in March, with YoY in-line with estimates at +2.6% 

  • ADP jobs +62K in April — lowest since July 2024

👀 What You Need to Know

While the GDP miss was largely caused by companies front-loading imports before tariffs hit, it’s the cooling in consumer spending, hot inflation and slowing job growth that’s more concerning for the broader economy. The good news is the Fed’s preferred PCE gauge showed some relief in March as core and headline inflation both came in flat month-over-month, while annual rates eased. That gives the Fed some breathing room, but with quarterly core PCE still running hot, a June rate cut is no lock. Markets will be watching Friday’s jobs report for the next signal.

🔐 Edge Takeaway: Today’s economic data is a clear warning sign. GDP…upgrade to Edge+ to read the full Edge Alert.

Amazon scraps tariff transparency plan after Trump call to Bezos

Amazon $AMZN ( ▲ 0.98% ) abruptly dropped plans to display U.S. tariff costs on product listings after President Trump personally called Jeff Bezos to object. The move came just hours after a report claimed the retailer was preparing to show customers how much of each item’s price stemmed from tariffs — a direct spotlight on the consumer cost of Trump’s trade war.

🔑 Key Points

  • Trump called Bezos Tuesday after reports surfaced about Amazon’s tariff transparency plans

  • Amazon initially confirmed the feature was being considered for its budget “Haul” section

  • Hours later, Amazon reversed course, saying it was “never approved” and “not going to happen”

  • White House slammed the move as “a hostile and political act”

  • Shein and Temu have already begun adding large import surcharges

  • Tariffs remain a major risk for Amazon, with ~70% of its goods sourced from China

👀 What You Need to Know

This episode underscores just how sensitive the Trump administration is to narratives around tariffs, especially those highlighting that American consumers, not China, bear the cost. Amazon's retreat shows the tightrope companies now walk between policy compliance and political blowback. With tariffs as high as 145% hitting key product categories, and retailers scrambling to adjust, the pricing pressure is real. For investors, this reaffirms that rhetoric and retaliation, not fundamentals, may be the driving force for major tech stocks in the near term.

📚 Edge-ucation: What would the tariff transparency costs mean?

If Amazon (or any retailer) were to show tariff transparency costs, it would mean explicitly breaking out how much of a product’s price is due to U.S. import tariffs—likely as a line item either next to the price or at checkout.

Here’s what that would mean in practical and economic terms:

🔍 For Consumers:

  • Clarity: Shoppers would see how much more they’re paying because of tariffs, making it clear that tariffs are a hidden tax on imported goods, not a penalty paid by China.

  • Sticker Shock: For low-cost goods (e.g. $10 earbuds), a 145% tariff could push the visible "import charge" above the base price—potentially doubling or tripling the total.

  • Shifting Behavior: If consumers see tariff charges in plain view, they may buy fewer imported items or switch to U.S.-made alternatives.

📦 For Retailers like Amazon:

  • Political Risk: Calling out tariffs publicly risks political backlash—as shown by Trump’s call to Bezos—especially if it suggests the administration is driving up prices.

  • Operational Complexity: Retailers would need to track and display varying tariff rates based on product category, country of origin, and current trade policy—no small feat.

  • Pressure on Margins: If sellers absorb some tariffs to keep prices competitive (instead of passing them on), that squeezes profits.

📈 For the Market:

  • Inflation Optics: Making tariffs more visible could stoke consumer frustration over inflation, even if inflation is moderating elsewhere.

  • Policy Blowback: Transparency might galvanize political opposition or lead to new calls for tariff relief.

  • Earnings Risk: Tariff visibility draws attention to one of the biggest cost pressures facing e-commerce and retail firms—especially those heavily exposed to Chinese manufacturing.

In short, tariff transparency pulls a hidden tax into the spotlight, and that’s exactly why it’s so controversial.

Earnings Roundup: tariff talk and guidance drive stock moves

Earnings season continued with a flurry of mixed results. While some companies delivered strong guidance and upbeat outlooks, others were dragged down by tariff concerns, margin compression, and weak top-line growth. Notably, several firms are beginning to cite Trump’s tariff agenda directly in earnings calls, with Caterpillar and GM among those flagging potential cost impacts. Despite the noise, stock reactions remain highly bifurcated—good news isn’t always rewarded, but bad news still gets punished.

🔑 Key Points

👀 What You Need to Know

The market is clearly selective this earnings cycle—tariffs are emerging as a key overhang, with multiple management teams flagging them as risks to margins or pricing power. Guidance, not just beats, is dictating price action. And even strong results are sometimes being faded, signaling a market that's cautious, if not outright skeptical. With mega-cap tech (AAPL, MSFT, AMZN, META) still reporting later this week, direction from here likely hinges on how resilient these giants look in the face of macro and policy headwinds.

*Note - our full breakdowns of these reports, along with graphics and our takeaways from each report will be sent out in Friday’s Earnings Recap.

In Other News

In this section we'll be curating a selection of news headlines we think you'll find interesting. If a topic catches your eye, click the provided links to read more about it.

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The Second Half

Earnings from several mega cap names are sure to move markets over the next few days, while all eyes will be on the nonfarm payrolls report on Friday.

Earnings Reports

Earnings season is ramping up and we will be busy to end the week. Here are the names we will be watching to end the week:

  • Wednesday 4/30: Microsoft, Meta, Qualcomm and VICI Properties

  • Thursday 5/1: Apple, Amazon, Eli Lilly, Mastercard, Airbnb, and Block

  • Friday 5/2: Exxon Mobil and Chevron

Here is the calendar of earnings releases scheduled for the rest of the week:

Source: Earnings Whisper

Economic Reports

It’s been a busy week for economic reports and that continues into the end of the week. We get nonfarm payrolls, unemployment, initial jobless claims, and manufacturing PMI.

Here is the full calendar of events scheduled for the remainder of the week:

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Thank you for reading this edition of the Mid-Week Wrap-Up.

Until next time investors!

Mark & Chris

The Investor’s Edge

Disclosure

This is not investing advice. It is very important that you do your own research and make investments based on your own personal circumstances, preferences, goals and risk tolerance.

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