Suit & Times Daily Briefing – May 12, 2025

Impending Doom

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📬 What We’re Covering Today

🧨 Trump’s China Deal Creates Global Trade Uncertainty
The new US-China pact slashes tariffs but leaves allies and markets guessing what comes next.

📈 US-China Trade Truce Sends Markets Soaring
Stocks rallied across the board after Washington and Beijing agreed to a 90-day pause on tariffs.

🩸 Elizabeth Holmes Advising New Blood-Testing Startup From Prison?
Despite a federal sentence, Holmes is reportedly helping her partner launch a startup with eerily familiar ambitions.

✈️ Schumer Demands Urgent Fixes at Newark Airport Amid Mounting Chaos
The Senate leader blasts the FAA and urges immediate upgrades after radar outages and mass delays.

📉 Tough Month for ETFs: These 10 Funds Led April’s Losers
Small-cap and dividend-heavy funds took a beating, with Direxion and Simplify ETFs leading the decline.

📈 The Ledger

Tracking key market indexes to give you a pulse on global financial movements. 

These indexes cover U.S. markets, global equities, small-cap stocks, volatility, and economic trends, offering a snapshot of where the market is heading.

🔹 Why These Indexes Matter:

• Broad Market Trends: The S&P 500, Dow Jones, and Nasdaq show how major U.S. companies are performing.

• Volatility & Risk: The VIX measures market uncertainty and investor sentiment.

• Global Perspective: FTSE 100, Nikkei 225, and MSCI World reflect international market health.

🧨 Trump’s China Deal Creates Global Trade Uncertainty

The Story: In a surprise move, the U.S. struck a quick and vague trade agreement with China over the weekend, reducing some tariffs but leaving most of the U.S.’s punishing duties in place. Treasury Secretary Scott Bessent and Chinese officials met in Switzerland to finalize the deal, which—like the earlier UK pact—is non-binding and light on specifics. While the Trump administration is touting it as progress, trade experts and foreign governments are left scrambling to understand what it actually means.

The deal’s lack of legal enforcement raises concerns that trade policy under Trump is increasingly ad hoc and transactional, vulnerable to whoever happens to have the president’s ear. Key sectors such as pharmaceuticals and aerospace are already seeing contradictory signals, while the broader global trading system—particularly the WTO’s foundational rules—is being further undermined. The uncertainty has left the UK and China exposed to shifting U.S. priorities, and created a climate in which even modest agreements carry geopolitical risk.

🔍 Key Takeaways

• Quick and confusing: Trump’s China deal was reached faster than expected, leaving many unclear on what was actually agreed.

• Non-binding terms: Like the recent UK agreement, the China deal is not legally enforceable, giving the U.S. broad discretion to shift terms later.

• Tariffs remain high: Despite the deal, most U.S. tariffs on Chinese goods remain in place, including controversial “fentanyl tariffs.”

• UK deal déjà vu: Britain may face pressure to side with the U.S. against China, despite no legal protection from future U.S. tariffs.

• Trade policy by roulette wheel: The randomness of Trump’s team — from hardliners like Peter Navarro to pragmatists like Howard Lutnick — makes outcomes unpredictable.

• WTO rules eroded: Both China and the UK accepted deals that bypass the “most-favored nation” principle, weakening the global trade framework.

• Development aid cuts deepen instability: As Trump slashes international aid and Bill Gates announces the wind-down of his foundation, developing nations are left in the lurch.

• Markets on edge: Investors remain nervous about financial market volatility due to inconsistent U.S. trade policy.

🔗 Read the full story → Financial Times

📈 US-China Trade Truce Sends Markets Soaring

The Story: Wall Street kicked off the week with a major rally after the US and China reached a temporary agreement to slash tariffs, calming fears of a prolonged trade war. The truce, which pauses most tariffs for 90 days, sent futures surging across the board — with tech stocks leading the charge. The Nasdaq soared nearly 4% in premarket trading, while Big Tech giants like Nvidia, Amazon, Apple, and Tesla all posted significant gains.

But not every sector is celebrating. Pharmaceutical stocks tumbled after President Trump vowed to slash US drug prices to align with international markets, triggering a global sell-off in healthcare equities. Meanwhile, commodity markets roared back to life, with oil and copper leading a broad rally, though analysts warn the celebration may be premature if trade tensions reignite.

🔍 Key Takeaways

• Markets jump on tariff truce: S&P 500 futures rose 3%, Dow futures gained over 1,000 points, and Nasdaq futures spiked 3.9% after a surprise US-China deal slashed reciprocal tariffs.

• Tariffs dramatically reduced: US duties on Chinese goods fell from 145% to 30%; China cut its tariffs from 125% to 10% — but only for 90 days.

• Big Tech leads rally: Shares of Nvidia, Tesla, Amazon, Apple, and Meta all surged as the supply chain outlook improved.

• Pharma stocks slide: Trump’s vow to cut US drug prices by up to 80% hit shares of Novo Nordisk, Eli Lilly, Pfizer, and AstraZeneca.

• Commodities climb: Oil, copper, and soybeans rallied as trade optimism boosted global demand forecasts, while gold prices slipped.

• Dollar and yields rise: The US dollar index gained 1.4% and Treasury yields climbed as risk sentiment returned.

• Analysts cautiously optimistic: Strategists say the truce boosts hopes for a “V-shaped” recovery but warn the 90-day limit keeps uncertainty high.

• Inflation data on deck: Investors are eyeing this week’s CPI and PPI reports to assess whether tariffs will reignite inflation.

🔗 Read the full report → Yahoo

🩸 Elizabeth Holmes Advising New Blood-Testing Startup From Prison?

The Story: Disgraced Theranos founder Elizabeth Holmes may be behind bars — but that’s reportedly not stopping her from dipping back into biotech. Holmes, who is serving an 11-year sentence for defrauding investors, is allegedly advising her partner Billy Evans on a new medical startup called Haemanthus. The company, which has raised millions, aims to use AI-powered sensors and beams of light to perform diagnostic tests with small samples of blood and other fluids — an eerily familiar concept given Theranos’ fraudulent promises.

Haemanthus has publicly denied Holmes has any involvement, calling NPR’s reporting “inaccurate” and claiming she has “zero role now or in the future.” But the optics of a Theranos sequel — especially one tied to her romantic partner — are raising eyebrows in Silicon Valley and beyond.

🔍 Key Takeaways

• Holmes behind bars, but reportedly advising: NPR reports that Elizabeth Holmes is giving behind-the-scenes input to her partner Billy Evans’ startup Haemanthus.

• Startup sounds Theranos-adjacent: The company uses Raman spectroscopy to test blood, saliva, and urine using light-based sensors and AI — reminiscent of Theranos' pitch.

• Millions already raised: Despite the controversial connection, Haemanthus has secured significant early funding, though its valuation and backers remain unclear.

• Evans denies Holmes' involvement: The company posted on X (formerly Twitter) insisting Holmes has “zero involvement,” past or present.

• Tech has broader applications: Raman tech has been used to detect diseases and even explosives, but its use in clinical diagnostics is still unproven at scale.

• SEC ban doesn’t apply: Holmes is barred from running public companies but could technically advise a private startup like Haemanthus.

• Legal woes continue: Holmes recently lost a bid to have her conviction reheard by the 9th Circuit Court of Appeals.

• HQ listed as $2.3M home in Austin: The company is registered to Evans' home, further fueling speculation about Holmes’ behind-the-scenes role.

🔗 Read the full story → New York Post

✈️ Schumer Demands Urgent Fixes at Newark Airport Amid Mounting Chaos

The Story: Senate Minority Leader Chuck Schumer is turning up the pressure on Transportation Secretary Sean Duffy, calling for immediate action to resolve the growing crisis at Newark Liberty International Airport. After another radar blackout and weeks of delays, Schumer blasted the Trump administration’s FAA for presiding over what he calls “a dangerous” and “unacceptable” situation, warning that Newark’s issues could be just the tip of the iceberg.

In response, Duffy acknowledged outdated tech is the root cause but fired back that the previous administration failed to fund critical upgrades despite spending over $1 trillion on infrastructure. As delays and cancellations stack up, Schumer is demanding Newark be prioritized for ATC system overhauls, including a direct fiber line and new computing systems to improve safety and reliability.

📌 Key Takeaways

• Schumer slams FAA under Trump admin: The Senate Minority Leader says the recent radar failures and delays at Newark reveal a national safety issue and demands urgent fixes.

• Calls for immediate upgrades: Schumer wants a direct fiber line installed between Newark and Philly ATC, new analysis computers, and priority placement for system improvements.

• Worsening travel disruptions: Newark has averaged 34 daily flight cancellations since mid-April, with evening delays ballooning to over 2 hours.

• Duffy blames old tech — and Democrats: The Transportation Secretary says legacy equipment is to blame but points fingers at the prior administration for failing to invest in ATC modernization.

• FAA promises improvements: The agency is working to build redundancy into local telecoms and updating automation systems to reduce outages and improve resiliency.

• Political blame game heats up: As Schumer and Duffy trade barbs, travelers continue facing chaos, with both parties blaming each other for years of underinvestment.

🔗 Read the full story → FOX News

📉 Tough Month for ETFs: These 10 Funds Led April’s Losers

The Story: Not all ETFs are built to weather every storm — and April was proof. The worst-performing equity ETFs last month were hit hard by market volatility, particularly in small-cap and dividend-focused strategies. At the top of the list: Direxion’s HCM Tactical Enhanced US Equity Strategy ETF, which shed more than 12%, and Simplify’s Volatility Premium ETF, down over 7%. Despite typically being stable portfolio builders, even some large, well-known funds took unexpected hits.

Small value ETFs were especially battered, with multiple entries among the bottom ten. Analysts point to sector-specific struggles, underwhelming earnings, and poor macro sentiment for the slump — underscoring that even passive or “smart beta” approaches aren’t immune to tough market conditions.

📌 10 Worst-Performing US Stock ETFs – April 2025

• Direxion HCM Tactical Enhanced US Equity (HCMT)
  Down 12.28%; actively managed large blend ETF trailed peers by a wide margin.

• Simplify Volatility Premium ETF (SVOL)
  Lost 7.72%; volatility-based strategy underperformed with a 12-month loss over 12%.

• Schwab US Dividend Equity ETF (SCHD)
  Fell 7.55%; despite strong long-term ratings, struggled in April’s dividend drag.

• First Trust Small Cap Value AlphaDEX (FYT)
  Dropped 6.72%; underperformed its small value category significantly.

• Invesco S&P SmallCap 600 Pure Value (RZV)
  Lost 6.48%; small-cap value names were broadly out of favor in April.

• Invesco S&P Ultra Dividend Revenue (RDIV)
  Down 6.31%; mid-cap dividend focus failed to hold ground during downturn.

• WisdomTree US SmallCap Quality Div Growth (DGRS)
  Dropped 6.31%; despite quality tilt, couldn't withstand pressure in small caps.

• VictoryShares Small Cap Free Cash Flow (SFLO)
  Lost 6.25%; newly launched ETF with weak one-year performance.

• VictoryShares US Small Cap Hi Div Vol Wtd (CSB)
  Declined 5.98%; volatility-weighted dividend strategy didn’t shield losses.

• First Trust Mid Cap Value AlphaDEX (FNK)
  Down 5.75%; mid-cap value strategy struggled, landing in bottom 5% of peers.

🔗 Read the full story → Morning Star

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💡 That’s it for today’s briefing. Stay sharp, stay informed, and we’ll see you tomorrow!