April 14th Market Overview

Happy Monday.

Two strong green days in a row, how lovely?

Markets kicked off the week with a nice rally, riding the wave of tech tariff exemptions announced over the weekend. The optimism faded when the administration began sending mixed signals about what is truly exempt. Goldman's strong earnings report helped keep major indexes rising, even with all the tariff confusion.

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Let's dig in...

Executive Summary

• Markets up as the Trump admin exempted key tech products from new reciprocal tariffs, boosting sentiment despite later confusion about the policy’s permanence
  

• Fed Governor Waller warned sustained high tariffs could temporarily push inflation near 5% and slow growth
  

• Goldman Sachs $GS beat Q1 earnings estimates ($14.12 vs. $12.35 est.) and announced a $40 billion share buyback program(setting tempo for other bank earnings this week)
  

• President Trump signaled potential short-term tariff pauses for automakers needing time to shift parts production to the US

Market Overview

Key Market Drivers

1. Tariff Whiplash Dominates Sentiment: Initial guidance exempting smartphones, computers, and semiconductors from new “reciprocal” tariffs sparked early gains. Commerce Secretary Howard Lutnick later warned many tech products might still face separate Section 232 levies. President Trump added uncertainty via social media, stating affected items were moving to a different “Tariff ‘bucket’”.
   

2. Economic Concerns: A Wall Street Journal survey showed economists now see a 45% chance of recession, nearly double January’s perceived risk. Hedge fund founder Ray Dalio stated the economy is “very close to a recession” due to the trade war. Former Treasury Secretary Janet Yellen noted patterns suggesting a potential “loss of confidence in U.S. economic policy.”
   

3. Supportive Technical Factors: Decreased market volatility aided the rally, with the VIX index falling 19.89% to 30.09. Additionally, falling US Treasury yields provided a tailwind for equities.
   

Stock Spotlight

Apple $AAPL ( ▼ 0.19% ) : Shares rose following tariff exemption news. Counterpoint Research showed Apple achieved its first-ever Q1 top spot in global smartphone sales with 19% share. KeyBanc upgraded to Sector Weight. IDC data suggested Apple shipped a record 57.9 million iPhones in Q1.

NVIDIA $NVDA ( ▲ 1.35% ) : Gained amid positive tech sentiment. Announced plans to build AI supercomputers within the US, partnering with Foxconn and Wistron to establish production in Texas within 12-15 months. Pledged “up to half a trillion dollars” towards US AI infrastructure over four years.

Goldman Sachs $GS ( ▲ 0.78% ) : Reported Q1 EPS at $14.12 (vs $11.58 y/y and $12.35 est), revenue at $15.06 billion (+6% y/y).

Strength from Equities trading ($4.19B vs $3.8B est) and Global Banking & Markets ($10.71B vs $10.42B est). Approved a $40 billion share repurchase program.

Ford $F ( ▼ 2.68% ) / General Motors $GM ( ▼ 1.33% ) : Advanced after President Trump indicated potential short-term tariff exemptions to provide time for shifting parts manufacturing to the US.

Viking Therapeutics $VKTX ( ▼ 5.94% ) : Jumped after Pfizer $PFE ( ▲ 1.45% ) discontinued its oral weight-loss drug candidate due to a patient liver injury, fueling acquisition speculation.

Big Name Updates

• Alphabet $GOOGL ( ▼ 1.74% ): Invested alongside NVIDIA in Safe Superintelligence Inc. (SSI), founded by former OpenAI chief scientist Ilya Sutskever.

• Meta Platforms $META ( ▼ 1.87% ): FTC Chair Ferguson stated the commission considers Meta to “certainly” be a “monopoly.”

• Amazon $AMZN ( ▼ 1.39% ): Citi lowered price target to $225 from $273.

• LVMH $LVMUY ( ▼ 4.49% ): Reported Q1 sales decline of 3% to €20.3 billion, missing expectations due to weakened Chinese consumer spending and trade tensions.

• Taiwan Semiconductor $TSM ( ▲ 0.96% ): Reportedly accelerating construction of its third Arizona fab, potentially starting this June, about a year ahead of schedule.

Other Notable Company News

Dell $DELL ( ▲ 0.35% ) / Arista $ANET ( ▼ 0.53% ): Gained on tariff exemption news for imported PCs and servers.

Intel $INTC ( ▼ 2.27% ): Reportedly nearing a deal to sell a majority stake in its Altera unit to Silver Lake.

Sony $SONY ( ▲ 1.02% ): Increased PS5 prices by approximately 25% in European markets and the UK.

Hut 8 $HUT ( ▼ 5.54% ): Received Buy rating from BTIG with $18 price target.

Palantir $PLTR ( ▲ 6.24% ): Climbed after NATO finalized acquisition of its Maven Smart System AI warfighting tool.

Structure Therapeutics $GPCR ( ▼ 0.26% ), Terns $TERN ( ▲ 3.9% ) , Altimmune $ALT ( ▼ 2.16% ): Gained amid speculation following Pfizer’s weight-loss drug news.

Sector Watch

Bond Market

US Treasury yields declined today, providing relief after the benchmark 10-year yield notched its largest one-week gain since 2001 last week, settling around 4.374%. Former Treasury Secretary Janet Yellen expressed concern, noting market patterns “suggestive of a loss of confidence in U.S. economic policy.”

Policy Watch

Fed Governor Christopher Waller described the new tariffs as “one of the biggest shocks to affect the U.S. economy in many decades,” projecting they could temporarily push inflation near 5% and slow growth, though the inflationary impact would likely be “transitory.”

Treasury Secretary Scott Bessent is reportedly prioritizing trade deal negotiations with the UK, Australia, South Korea, India, and Japan following the broad tariff announcements.

The European Union stated it is ready for a “fair deal” during the 90-day tariff pause window, though warned it requires “significant joint effort.”

What to Watch

1. Upcoming Earnings Reports:
   

   • Tuesday AM: Bank of America $BAC, Citigroup $C, Johnson & Johnson $JNJ

   • Tuesday PM: United Airlines $UAL

   • Wednesday AM: ASML Holding $ASML, Abbott Laboratories $ABT

   • Wednesday PM: CSX Corp $CSX, US Bancorp $USB

   • Thursday AM: American Express $AXP, Blackstone $BX, Taiwan Semiconductor $TSM, UnitedHealth $UNH

   • Thursday PM: Netflix $NFLX ( ▲ 4.83% ) 
     

2. Federal Reserve Chair Powell’s Remarks: Powell discusses economic outlook Wednesday (1:30 PM ET), with focus on tariff impacts on inflation, growth, and interest rates.
   

3. March Retail Sales Data: Due Wednesday at 8:30 AM ET. Economists forecast 1.2% rise, largely fueled by auto purchases.
   

4. Central Bank Decisions: Bank of Canada (Wednesday) and European Central Bank (Thursday) announce rate decisions. ECB widely expected to cut rates by 25 basis points.
   

5. Ongoing Tariff Developments: Monitor official statements regarding tariff specifics, exemptions, and negotiations. China reportedly halted exports of critical rare earths (controlling ~70% of global supply).

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- John