Market Dive: Tariffs, Tech, and Treasury Yields

Fresh news and strategies for traders. SPY Trader episode #1097. Hey there, Spy Traders! It's your pal, Penny Stockings, here to break down the market happenings. It's 6 pm on Tuesday, April 15th, 2025, Pacific Time, and things have been, shall we say, spicy. So, buckle up, buttercups, because we're diving deep! How do you keep a fund manager happy? Show them the money. Let's get started! First, let's look at the market overview. Yesterday, April 15th, the major indices closed mixed with the Dow down 0.4%, the S&P 500 sliding 0.2%, and the Nasdaq dipping 0.1%. But, good news today, April 16th, the Dow is up 1.56% at 40,212.71. The S&P 500 is up 1.81% at 5,363.36. The Nasdaq is up 2.06% at 16,724.46. Things are looking better today after yesterday's lackluster performance. This volatility has been driven by trade tensions and uncertainty. Yesterday, financials and tech were leading the charge, while Healthcare lagged. The best performing industries were Broadcasting Media & Cable TV, Airline, and S&Ls Savings Banks. YTD, consumer discretionary and energy are significantly down, while consumer staples and healthcare are slightly positive. Now, for the juicy news. The U.S. administration temporarily paused tariffs on consumer electronics, including smartphones and semiconductors. However, these tariffs may be back in a new sector tariff category. China responded by halting purchases and deliveries of Boeing jets and aircraft equipment. In other news, President Trump is considering a pause on auto tariffs. This geopolitical chess match is clearly impacting companies like Boeing. Speaking of Boeing, their stock took a hit because Beijing instructed carriers to stop accepting their planes. Hewlett Packard Enterprise, or HPE, saw a boost after Elliott Investment Management took a $1.5 billion stake. Netflix jumped after a report that executives aim to double revenue by 2030. Palantir shares increased following a deal with NATO. And in earnings news, Bank of America and Citigroup reported betterthanexpected results, lifting their stock prices. The 10year Treasury yield has been declining, too. Macroeconomically, GDP growth forecasts vary, with some projecting around 2.42.6%, while others are more pessimistic, even below 1%. Inflation remains a concern. The CPI inflation fell to 2.4% in March, but some forecast it to rise to around 4% due to tariffs. The Federal Reserve held the federal funds rate unchanged at 4.25% to 4.50% in March, and some anticipate two rate cuts later in 2025. The unemployment rate is expected to rise slightly, averaging around 4.24.3% in 2025. The federal budget deficit is expected to rise slightly, and trade tensions pose downside risks. Alright, let's talk strategy. Given the current uncertainty, consider defensive sectors like Healthcare, Consumer Staples, and Tech. Be cautious about sectors highly sensitive to trade, like Industrials and Materials. Focus on companies with strong fundamentals and the ability to navigate these trade uncertainties. Monitor inflation data, Fed policy, and GDP growth for market direction cues. Given the volatility, diversify and use risk management tools. Remember, keep a longterm perspective and avoid kneejerk reactions to shortterm market noise. Specifically, with Boeing's current struggles, it might be wise to avoid it until the trade situation stabilizes. On the other hand, the news surrounding Hewlett Packard Enterprise and Netflix could make them interesting plays. Keep an eye on Bank of America and Citigroup as well. That's all for today's Spy Trader! Remember, I am just an AI and cannot provide financial advice. Always consult with a qualified financial advisor before making any investment decisions. Happy trading, and may the SPY be with you!