The S&P 500 Index ($SPX) (SPY) today is up +1.20%, the Dow Jones Industrials Index ($DOWI) (DIA) is up +0.82%, and the Nasdaq 100 Index ($IUXX) (QQQ) is up +1.26%. June E-mini S&P futures (ESM25) are up +1.22%, and June E-mini Nasdaq futures (NQM25) are up +1.28%.
Stock indexes today are moderately higher after President Trump late last Friday said he will temporarily exempt consumer electronics, including smartphones and computers, from reciprocal tariffs and the baseline 10% global tariffs. However, a 20% tariff still applies to electronics shipped from China. The Magnificent Seven stocks and chip makers are moving higher on the tariff news to lead the overall market higher.
Last Wednesday, President Trump announced a 90-day pause on higher reciprocal tariffs on 56 nations but left the new 10% baseline tariff on virtually all nations in place. Meanwhile, the EU last Thursday said it will delay for 90 days the implementation of 25% tariffs on 21 billion euros worth of US goods sent to Europe.
Stocks have been under pressure over the past five weeks due to fears that US tariffs will weaken economic growth and corporate earnings. On March 4, President Trump imposed 25% tariffs on Canadian and Mexican goods and doubled the tariff on Chinese goods to 20% from 10%. On April 2, President Trump signed a proclamation to implement a 25% tariff on US auto imports. The tariffs will initially target vehicles fully assembled outside the US and, by May 3, will expand to include automobile parts made outside the US. Mr. Trump said the tariffs were “permanent,” and he was not interested in negotiating any exceptions. On April 5, a 10% baseline tariff for virtually all nations took effect. Last Friday, China raised tariffs on all US goods to 125% from 84% in retaliation for the US raising tariffs on Chinese goods to 145%.
The US tariff turmoil is hammering the dollar and boosting gold. The dollar index last Friday sank to a 3-year low, and gold prices soared to an all-time high. The markets are concerned about the effects of US trade policies, which have caused consumer confidence to plummet and have prompted many companies to suspend their capital spending plans, a negative factor for GDP growth. Also, the dollar is facing a confidence crisis as the US weaponizes tariffs, diminishing the dollar’s reserve-currency status and prompting some foreign investors to liquidate their dollar assets.
The markets will focus on US trade policy news this holiday-shortened week. On Wednesday, US Mar retail sales are expected to climb +1.4% m/m, and Mar retail sales ex-autos are expected +0.4% m/m. Also, on Wednesday, Mar manufacturing production is expected to be up +0.3% m/m. Finally, on Wednesday, Fed Chair Powell will speak before the Economic Club of Chicago about the economic outlook. On Thursday, Mar housing starts are expected to fall -5.7% m/m to 1.416 million, and Mar building permits are expected -0.6% m/m to 1.450 million.
The markets are discounting the chances at 20% for a -25 bp rate cut after the May 6-7 FOMC meeting.
Q1 earnings reporting season began last Friday as big US banks reported their results. According to data compiled by Bloomberg Intelligence, the market consensus is for Q1 year-over-year earnings growth of +6.7% for the S&P 500 stocks, down from expectations of +11.1% in early November. Full-year 2025 corporate profits for the S&P 500 are seen rising +9.4%, down from the forecast of +12.5% in early January.
Overseas stock markets today are higher. The Euro Stoxx 50 is up +2.59%. China’s Shanghai Composite Index climbed to a 1-week high and closed up +0.76%. Japan’s Nikkei Stock 225 closed up +1.18%.
Interest Rates
June 10-year T-notes (ZNM25) today are up +16 ticks. The 10-year T-note yield is down -7.9 bp to 4.411%. June T-notes are climbing today due to reduced inflation concerns after President Trump exempted reciprocal tariffs on most consumer electronics late last Friday. T-notes also have carryover support from today’s strength in European government bonds. In addition, T-notes have support from last Friday when the Financial Times reported that Boston Fed President Collins said the Fed is ready to help stabilize markets if needed.
European bond yields today are moving lower. The 10-year German bund yield is down -4.7 bp to 2.523%. The 10-year UK gilt yield is down -9.1 bp to 4.662%.
Swaps are discounting the chances at 96% for a -25 bp rate cut by the ECB at the April 17 policy meeting.
US Stock Movers
Magnificent Seven stocks are moving higher today to boost the broader market. Apple (AAPL) is up more than +4% to lead gainers in the Dow Jones Industrials, and Alphabet (GOOGL) and Tesla (TSLA) are up more than +2%. Also, Nvidia (NVDA) is up more than +1%, Microsoft (MSFT) is up +0.61%, and Meta Platforms (META) is up +0.59%.
Chip makers and technology hardware stocks are climbing today after President Trump temporarily paused reciprocal tariffs on consumer electronics. As a result, Micron Technology (MU) is up more than +4%, and Seagate Technology Solutions (STX) is up more than +3%. Also, Advanced Micro Devices (AMD), ARM Holdings Plc (ARM), and Microchip Technology (MCHP) are up more than +2%. In addition, Texas Instruments (TXN), KLA Corp (KLAC), Marvell Technology (MRVL), NXP Semiconductors NV (NXPI), and GlobalFoundries (GFS) are up more than +1%.
Computer makers and electronic retailers are moving higher after the Trump administration exempted consumer electronics from its reciprocal tariffs. As a result, Dell Technologies (DELL) is up more than +5%, and Best Buy (BBY) and HP Inc (HPQ) are up more than +4%.
PDD Holdings (PDD) is up more than +7% to lead gainers in the Nasdaq 100 after President Trump paused reciprocal tariffs on most consumer electronics.
Palantir Technologies (PLTR) is up more than +5% after NATO acquired an AI-powered military system from the company.
Atlassian Corp (TEAM) is up more than +3% after Baird upgraded the stock to outperform from neutral with a price target of $255.
Intel (INTC) is up more than +2% after saying it is nearing an agreement to sell a stake in its programmable chips unit, Altera, to Silver Lake Management.
DuPont de Nemours (DD) is up more than +2% after KeyBanc Capital Markets upgraded the stock to overweight from sector weight.
Freeport-McMoRan (FCX) is up more than +2% after HSBC upgraded the stock to buy from hold with a price target of $40.
Norwegian Cruise Line Holdings Ltd (NCLH) is up more than +2% after CFRA upgraded the stock to buy from hold with a price target of $20.
DaVita (DVA) is down more than -4% to lead losers in the S&P 500 after disclosing a ransomware incident that has encrypted some aspects of its network.
Defensive healthcare stocks are falling today due to the strength in the broader market. As a result, UnitedHealth Group (UNH) is down more than -1% to lead losers in the Dow Jones Industrials. Also, Humana (HUM) and Centene (CNC) are down more than -1%.
Hotel stocks are under pressure today on downgrades. Hyatt Hotels (H) is down more than -2% after Goldman Sachs downgraded the stock to sell from hold with a price target of $110. Also, Hilton Worldwide Holdings (HLT) and Marriott International (MAR) are down more than -1% after Goldman Sachs downgraded the stocks to neutral from buy.
Earnings Reports (4/14/2025)
Applied Digital Corp (APLD), FB Financial Corp (FBK), Goldman Sachs Group Inc/The (GS), M&T Bank Corp (MTB), Pinnacle Financial Partners In (PNFP).
