To The Moon

The U.S. economy contracted more than expected in Q1, with final GDP revised to -0.5% (vs. -0.2% forecast). This sharp downgrade raises key concerns.

Negative scenarios to watch:

🔻 Rising recession risk if Q2 GDP (to be released on July 25, 2025) also shows negative growth

💼 Potential for weaker corporate earnings, especially outside AI/tech sectors (Q2 earnings reports in July)

⚠️ Stagflation threat if inflation remains sticky (PCE report on June 28) while growth stalls

💣 Market is heavily concentrated in mega-cap tech, which may unwind quickly if sentiment shifts

If upcoming data (PCE inflation, jobs report, Fed minutes) disappoints, the market could face a broad-based correction.

Positive scenarios to watch:

✅ If inflation data (PCE) shows meaningful cooling, the Fed could pivot faster toward rate cuts, supporting markets

✅ Strong jobs data and resilient earnings from AI and tech companies could boost confidence

✅ Consumer spending and retail sales staying firm would signal underlying economic strength despite GDP contraction

Yes, weaker GDP may lead to rate cuts—but if earnings and confidence drop first, that relief might come too late.

🛡️ Time to review risk exposure and stay alert.

#StockMarket #GDP #Recession #RateCuts #SP500 #NASDAQ #Investing #Markets