The first quarter of 2025 will go down as one in which it paid to remain exceptionally nimble. Implementing a macro view could have been correct at 9 a.m. London time, only for it to be sent to the bin by 4 p.m. New York time.
The bulk of the headaches came from President Trump’s changing rhetoric, with tariff uncertainty spreading not just through the equity markets but also in the Treasury space and commodities.
The 19% gain for gold during the quarter and the 12% drop in Bitcoin highlighted the extent of investor caution.
Aside from Trump, markets were spooked by AI worries, both with the rise of DeepSeek and the conversation around whether AI infrastructure spending is warranted in such quantities.
Finally, a recalibration of European growth prospects with large spending plans helped to provide some bright sparks, even if it’s partly driven by concern about Russia. China tech outperformed, but many still hesitate to get involved.