Bourstad stock market simulations - Summary of the markets for the week ended on May 2, 2025

Stocks up and commodities down for a second week running

Stocks, crypto-currencies and the US dollar were up again this week. In Canada, gross domestic product fell by -0.2% in February 2025 compared with January; this decline was particularly due to setbacks in the mining, oil & gas, construction, transportation & warehousing and real estate services sectors. S&P Global also reported a decline in the manufacturing PMI (Purchaser's Managers Index) for Canada, which now stands at 45.3, in line with the level reached when activity was considerably reduced during the COVID-19 pandemic. In the United States, 177,000 jobs were created in April, while the unemployment rate remained unchanged at 4.2%. In addition, the US measure of inflation based on personal consumption expenditure for March was down -0.4% to 2.3% year-on-year in March for the full basket, and a similar decline for the basket excluding food and energy, which now stands at 2.6%. Elsewhere in the world, the unemployment rate in the Eurozone held steady at 5.8%, while growth rose to 0.4% year-on-year. In Japan, the unemployment rate for March reached 2.5%. Over the course of the upcoming week, we'll be keeping an eye on: in Canada, international transactions in goods and services for March (Tuesday) and employment data for April (Friday); in the United States, international transactions in goods and services for March (Tuesday), the Fed's decision on the key rate (Wednesday) and wholesale sales for March (Thursday). Elsewhere in the world, Eurostat will publish March retail sales in the Eurozone, and China will release its inflation rate for April.

Five of the six stock markets we follow end the week higher. Three of the six markets we follow reported gains in excess of 3%: the NASDAQ 100 with 3.5%, the Tokyo Stock Exchange with 3.2% and the Paris Bourse with 3.1%. The New York Stock Exchange follows close behind with 2.9%. The Toronto Stock Exchange continued its upward trend, gaining 1.3%. The only stock exchange to decline was Shanghai, which lost -0.5%.

Yields on 10-year government bonds are up for two of the four top-rated countries we track, while Canada's bond yield remains unchanged. Higher yields mean lower bond prices, given the inverse relationship between yields and bond prices. The U.S. bond yield, the main benchmark rate on the market, rises by 7 bps to 4.31% (1 basis point or bps = 0.01%). The Canadian bond yield is unchanged for the week, making the Canadian rate 114 bps lower than the U.S. rate. Germany's bond yield rises by 7 bps to 2.54%. Japan's bond yield fell by -8 bps to 1.26%.

On the commodities market, the four commodities we follow are down. Gold is down ‑2.4% to US$3,240. Corn is down -3.4%, prompting market specialists to be pessimistic about the commodity's price evolution. Copper is down -4.5% as the United States accelerates the issuance of permits to start up new mines. Oil is down -7.5% as the trade war is already having a negative impact on oil demand.

In the crypto-currency sector, the two cryptos we follow are on the rise: bitcoin by 1.6% and ethereum by 2.6%.

On May 2, it cost 0.4¢ CAD less to buy one US dollar than on April 25. By contrast, the euro and yen are down against Uncle Sam's dollar: the single European currency by -0.6% and the Japanese currency by -0.9%.

See the detailed table by following this link:

https://iclf.ca/DL/BTTT_sommaire_marches_250502.pdf

Paul Bourget
Project Director, Bourstad
CIRANO
paul.bourget@cirano.qc.ca

About CIRANO (www.cirano.qc.ca )

The Center for Interuniversity Research and Analysis of Organizations (CIRANO) is a multidisciplinary, liaison and transfer research center, whose mission is to accelerate the transfer of knowledge between the research community and users in industry and public services.

About BOURSTAD (www.bourstad.ca )

The Bourstad program is an activity of the Center for Interuniversity Research and Analysis of Organizations (CIRANO) which receives support from many partners for this financial education project: the Autorité des marchés financiers, its main partner, TD Bank, CFA Montreal , the Canadian Investment Regulatory Organization (CIRO), Les Affaires, Finance Montreal, TMX Group, Hyprasoft, Groupe Investissement responsable and QuoteMedia.