Before the bell: Best Trading Day of 2025

The U.S. stock market had its best day of the year on Friday. But is this the end of the downward trend? Meanwhile, the U.S. attack on Yemen is fueling geopolitical tensions.

When something is positive, we should acknowledge it. After the Nasdaq technology index had already fallen 10% this year, it suddenly surged by 2.6% on Friday. That marked the best trading day of 2025 for the index. However, this might just be a so-called “dead cat bounce,” meaning the recovery could be temporary. Time will tell. In Europe, the stock market recovery continued, with a 1.9% gain in Frankfurt. The German government reached an agreement with the Greens to allocate additional funds for the military and infrastructure. The German 10-year bond yield has already risen sharply, climbing from 2.40% at the end of February to 2.87% on Friday. It is now approaching the critical 3% level, which hasn’t been seen since 2011. In Hong Kong, the market gained 0.9% this morning after retail sales and industrial production figures in China exceeded expectations. Meanwhile, Japan’s Topix index rose 1.2%.

Today, investors will be paying close attention to shipping stocks. Shares of companies such as Frontline, CMB.Tech, and Scorpio Tankers are expected to rise. Over the weekend, the U.S. launched an attack on the Houthi rebels in Yemen, reigniting tensions in and around the Red Sea. Later today, we will also receive U.S. retail sales data. Additionally, a few smaller companies, including the Canadian technology holding company Quarterhill, Lithium Argentina, and Fountain, will release their earnings reports.

Investing in Uncertainty

With the U.S. attack on Yemen, this could be a strong week for oil tanker stocks like Frontline. Last week, shipping rates already started to climb after the U.S. imposed sanctions on Iranian oil tankers. With the military escalation against the Houthis in Yemen, two months of relative peace in the Red Sea have abruptly ended. War risks are not covered by insurance companies, impacting shipping routes. After all, a single missile or drone strike could cause tens of millions of dollars in damage to cargo and vessels. The solution? In 2025, a large portion of global shipping will still need to reroute around Africa’s Cape of Good Hope. Ships taking longer routes create tighter market conditions, leading to higher freight rates. We expect a strong opening for many shipping stocks today.

Give Me a Job!

59.6%—That’s the youth unemployment rate in South Africa, while the overall unemployment rate stands at 32%. The country suffers from a severe shortage of jobs and foreign investments to sustain its population of over 60 million people. The potential closure of ArcelorMittal’s operations in South Africa is a painful blow. But even more striking are the aggressive negotiations currently taking place. The steelmaker is demanding 170 million dollars in government aid, lower energy tariffs, and reduced regulation—or else, they will leave. Now that Trump has also taken diplomatic action against South Africa by expelling its ambassador, there is a real possibility that foreign investment in the country could decline. ArcelorMittal appears to be striking while the iron is hot and could end up securing concessions from the South African government.

Did You Know…

Only 36 companies are responsible for more than half of global carbon emissions? This is according to a report by the Carbon Majors Database. The list is dominated by oil, gas, and coal producers, but cement manufacturers also rank high.

This article was translated from Dutch and was originally published on Spaarvarkens.be.