Stock Market Update Monday May 19, 2025

Stock Market Update Monday May 19, 2025 The early decline in equities was met with buying interest, enabling the S&P 500 (SPX) to post a modest gain, marking its sixth consecutive positive session, albeit by a narrow margin.

Market performance was mixed: the SPX rose 0.1% to 594.85, the Nasdaq 100 ETF QQQ gained 0.1% to 106.21, while the Russell 2000 ETF (IWM) declined 0.5% to 208.97.

Away From Stocks: The VIX surged above 18, reflecting heightened volatility. Crude oil and gold posted modest gains, while the U.S. Dollar Index (DXY) opened lower and remained subdued, closing at $100.36. Treasury yields experienced volatility following Friday's Moody's downgrade but ultimately stabilized, alleviating broader market concerns. The 10-year Treasury yield peaked at 4.56% this morning before retracing most of its advance, closing at 4.45%. WTI crude remained at $62 a barrel, gold rose to $3,231 per ounce, bitcoin advanced towards $106,000 and the VIX settled at 18 after testing 19.5 early.

🗓️ Macro Calendar: Week of May 19–23, 2025

🔹 Key Economic Data Releases

Tuesday, May 20

• 9:00 AM ET – Bostic: Opening Remarks

• 9:00 AM ET – Barkin: Richmond Fed Conference Speech

• 9:30 AM ET – Collins: Fed Listens Event (New Hampshire)

• 1:00 PM ET – Musalem: Economic Outlook and Policy

• 5:00 PM ET – Kugler: Commencement Address

• 7:00 PM ET – Hammack & Daly: Keynote | Bostic: Moderator

Wednesday, May 21

• 12:15 PM ET – Barkin & Bowman: Fed Listens Session

Thursday, May 22

• 2:00 PM ET – Williams: Keynote Remarks

Friday, May 23

• 12:00 PM ET – Cook: Financial Stability Speech

Moody's Downgrade

Moody’s recently downgraded the U.S. sovereign debt rating, a move that drew commentary from Bessent, a newly appointed government policy official overseeing budget strategy, debt ceiling negotiations, and trade discussions. Bessent described Moody’s as a "lagging indicator," suggesting that the downgrade reflects already-known fiscal concerns rather than new developments. As part of his broader debt management strategy, Bessent is working to advance a presidential bill aimed at raising the debt ceiling through congressional approval.

Timeline of U.S. Sovereign Rating Changes:

• S&P: August 5, 2011 – AAA to AA+

• Fitch: August 1, 2023 – AAA to AA+

• Moody’s: May 16, 2025 – Aaa to Aa1

Why the Market Reaction Has Been Muted