3 Things We’re Watching This Week

Markets never rest, even though some of us could probably use a nap. Well, that’s not happening this week – with market movements, continued tariff talk and the shock of a legend stepping down from what may be the most prominent investor perch keeping us busy. Here are three things we’re watching out for this week.

Buffett says goodbye
It’s the end of an era. At 94 years old, Warren Buffett, the Oracle of Omaha, revealed that he will step down as CEO of Berkshire Hathaway at the end of the year, the investment company he’s led since 1965. Back then, Berkshire was a poorly performing textiles business. Buffett transformed it into a holding company that made big bets on boring, cash-flow-generating companies, such as GEICO, Dairy Queen, Coca-Cola and Apple. Since becoming CEO of Berkshire, the company’s stock has skyrocketed by more than 5 million per cent.¹ Yes, you read that right. Absolute legend.

What we’re watching out for: While Buffett may be the investing industry’s one true rock star (minus the excess living; he lives in the same house he bought in 1958), his always-quoted and often-copied investment philosophy will continue to guide Berkshire far into the future. Canadians will be happy to hear that the new guy in charge is one of us: Greg Abel, a born and bred Edmontonian and University of Alberta grad who has worked with Buffett since 2000. The Oracle may be moving on, but his brilliant investment ideas will continue guiding investors for decades to come.

April’s wild ride comes to an end
Was it just us, or did April feel more like 30 years than 30 days? That’s probably at least in part because it was the most volatile month since 2020,² with markets plummeting by a 12 per cent between April 2 – Liberation day, when U.S. President Donald Trump announced 10 per cent tariffs on all U.S. imports and higher tariffs on 57 other countries – and April 8. While the next week saw some more ups and downs, things settled down after Trump announced a 90-day pause on reciprocal tariffs. After all that, the S&P 500 ended the month down a mere 0.71 per cent, while the S&P/TSX dropped by 0.3 per cent – a stunning turnaround that will no doubt put a smile on many investors’ faces.

What we’re watching out for: Just because things are calmer doesn’t mean we won’t see more big announcements in the future that could send stocks spinning once again. What’s happened is a good reminder that it usually doesn’t pay to panic. If you sold your stocks after Liberation Day and stayed in cash, you would have missed out on the subsequent gains – it can be harder to find the right time to get back into the market than the right time to get out. Secondly, it’s impossible to predict what might come next. Movie tariffs? That’s the latest trade war talk. A deal with China? Maybe, maybe not. Bottom line: remember your investment goals and focus on your long-term plan.

No more party at the port
It wasn’t long ago that we all had ports on our mind – no, not the fortified wine, but actual shipping ports. While the supply chain issues of COVID-19 may be in the past, new concerns over what impact tariffs may have on shipments into the U.S. from China and beyond are starting to creep into the economic conversation. At the end of April, Gene Seroka, executive director of the Port of Los Angeles, told CNBC that he expects incoming cargo volume to drop by 35% as consumers and businesses hold back on ordering tariff-laden goods. As well, the de minimus tariff exemption ended on May 2 for many countries (though not Canada and Mexico for now), which puts duties on goods worth less than $800. Temu, for one, has already said they’re going to stop shipping items from China to the U.S. and move to a local shipment model instead.

What we’re watching out for: There are growing concerns that some store shelves will soon be empty and about the impact that could have on the U.S. and Canadian economy. In the U.S., GDP already shrank by 0.3 per cent in the first quarter of 2025 and while RBC Economics points out that the U.S. consumer performed better than expected, could tariff-related supply chain disruptions cause people to pull back on their spending? In April, consumer sentiment in the U.S. fell by 8.4% month-over-month and 32.4% year-over-year. We’ll keep an eye on where things go from here.

Sources
^1. _{CNBC, "Warren Buffett's return tally after 60 years:5,502,284%", May 2025}
^2. _{Zacks Investment Management, "April Was The Most Volatile Month Since 2020 - How To Prepare For What's Ahead", April 2025}