At Via Luce Capital, we believe clarity matters—especially during times of volatility. The week of April 7 through 11 gave investors a serious case of whiplash, as markets swung wildly in response to shifting trade policy and broader economic signals. Here's what happened, why it matters, and what we’re watching next.
A Week of Historic Volatility
Markets kicked off the week under pressure, with the S&P 500 inching closer to bear market territory. Then on Tuesday, fears around a new round of tariffs sparked a sharp 1.6% selloff—one of the most volatile sessions we’ve seen in over a year. But by Wednesday, a sudden about-face from Washington changed the tone entirely. President Trump announced a 90-day pause on the newly proposed 10% reciprocal tariffs, and the S&P responded with a jaw-dropping 9.5% rally—the biggest one-day gain since the 2008 financial crisis.
Unfortunately, the celebration was short-lived. On Thursday, the market reversed course again, giving up 3.5%. And by Friday, another modest recovery helped the S&P notch its best weekly gain in over a year. Behind the scenes, bond yields were all over the map, the dollar fell sharply, and commodities from oil to gold to Bitcoin reacted in kind. It was a reminder of just how interconnected—and reactive—today’s markets are.
A Glimmer of Relief on Inflation
Amid the noise, one signal stood out: a slight cooling in inflation. March’s Consumer Price Index (CPI) showed a 0.1% monthly decline—the first since 2020. Gas prices dropped meaningfully, though grocery costs, particularly for staples like eggs, rose. On an annual basis, inflation now sits at 2.4%, down from 2.8% the month prior. While that’s welcome news, economists caution that any relief could be temporary, especially if trade-related price pressures resurface.
Consumer Confidence Wavers
Despite the inflation dip, consumer sentiment took a significant hit. The University of Michigan’s index dropped to 50.8 in April—the lowest reading since mid-2022. People across income and age groups are feeling more uncertain about their finances, job prospects, and the broader economy. Short-term inflation expectations jumped to levels not seen since the early ’80s, and concerns about rising unemployment are back on the radar.
What It All Means
Market volatility. Shifting trade policy. Conflicting inflation signals. Right now, investors are navigating an environment shaped by policy uncertainty and fragile consumer confidence. The 90-day tariff pause may bring some short-term relief, but underlying instability remains. And with the Fed’s next move up in the air, the path forward could be bumpier than investors might like.
At Via Luce Capital, we’re leaning into this complexity—not away from it. Our approach emphasizes adaptive, risk-aware portfolio design that seeks to protect and participate—especially when headlines get loud.
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