Stocks moved sharply higher this week after a dual boost from trade policy and inflation data.

Over the last weekend, the US and China agreed to a 90-day reduction in tariffs that had previously been in the triple-digit range, easing near-term trade tensions. Investors also welcomed the April 2025 Consumer Price Index (CPI), which slowed to 2.3 percent—the lowest reading since February 2021 and below the 2.4 percent consensus forecast. Although the softer inflation print bolstered hopes for policy easing, the FedWatch tool still points to the first potential rate cut in September.

Next week, the economic calendar is relatively light. April existing-home-sales data will headline the week, with economists projecting a seasonally adjusted annual rate of 4.1 million homes—up slightly from March. Markets will also parse multiple Federal Reserve speeches for any guidance on the path of rate cuts, while the customary weekly jobless-claims release remains a barometer of labor-market resilience, which has been trending lower yet still within a healthy range.

Given this economic backdrop, let us see how this impacts the performance of various investment strategies.