MARKET WRAP

A fairly healthy drift higher for equities today, particularly in mega cap tech into the first of the Mag7 reports. On the day: SPX +2%, QQQ + 2.3% and IWM +2%. The US10Y is back to 4.31. The VIX is below 27 and short term option pricing is some of lowest we’ve seen in a month (more on that at the bottom of the email). Gold was higher again as was Oil.

After hours: Alphabet beat estimates, the stock is higher by about +4%, while Intel , issued weak guidance and plans to cut spending, that stock down about -7%.

• MRKT Call: Danny Moses is back! Guy and Danny discuss trading these volatile swings, a look at historical earnings multiples, thoughts on the dollar, GOOGL, WMT and more.

• RiskReversal Pod: Dan Niles joins to talk policy uncertainty, inflation, market valuations, AI, Tesla's market challenges, the evolving landscape for Google, Meta, and Apple and warnings on FOMO chasing.

MRKT MATRIX: April 24, 2025

Today’s Top Stories:

• S&P 500 rises, Nasdaq pops 2% in tech-fueled jump (CNBC)

• One of Wall Street’s Biggest Bulls Slashes View as Tariffs Bite (Bloomberg)

• US Bonds Rally as Fed’s Hammack Revives Odds of a June Rate Cut (Bloomberg)

• JPMorgan Sees ‘Tremendous’ Opportunity in Treasuries on Fed Cuts (Bloomberg)

• The trade war’s wave of retail shortages will hit U.S. consumers in stages. Here’s when (CNBC)

• American Air Pulls Full-Year Outlook on Softer Demand Worry (Bloomberg)

• Merck Expects $200 Million Tariff Hit Amid Gardasil Fallout (Bloomberg)

• Procter & Gamble CEO says price hikes are ‘likely,’ as Tide owner cuts outlook due to tariffs, uncertainty (CNBC)

• Bank of America cuts Apple price target on tariff hit, delayed AI rollout (CNBC)

Today’s MRKT Call is Presented by SoFi

The Walmart Recession Indicator

Danny Moses is back to co-host with Guy for today! An update on the market and some large bank analysts throwing in the towel with this year’s SPX targets. A discussion on earnings multiples historically. Danny proposes a trading strategy during these large market swings to use dips to buy quality and use rips to sell your junk. Also, does the dollar have further to fall? 

• SoFi Report: Regional Fed Composite declines, S&P 500 Cyclicality, Historical performance of staying invested.

• Chart of the Day: WMT

• Analysis: SPX, DXY, GENI, SRAD, WMT, AAL, LUV

• Your Questions Answered: 

  • Can Danny update us on GENI

  • Danny, do you remain negative in AFRM, and how would you express that view trade wise?

  • Any thoughts on shipping embargos from China taking 30-50 days to show up for consumers?

  • Does Danny have Kentucky Derby picks yet?

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Today’s RiskReversal Podcast is Presented by Betterment and RBC

CrackBerry to RoboTaxi: How Dan Niles Thrives In Tech Investing Hype Cycles

Dan Nathan hosts portfolio manager Dan Niles of Niles Investment Management. They discuss Dan's January prediction to prioritize cash over high-growth stocks, given the market's volatility and macroeconomic uncertainty. The conversation covers critical topics like policy uncertainty, inflation, and market valuations, and the impact of AI investments. They also delve into specific company performances, such as Tesla's market challenges and the evolving landscape for major tech firms like Google, Meta, and Apple. Through this discussion, Dan Niles emphasizes the importance of understanding fundamentals and the risks of investing in overvalued stocks. The episode concludes with reflections on historical market patterns and their implications for current investment strategies.

Timecodes

• 0:00 - 2025 Thus Far

• 8:00 - TSLA & Futurists

• 18:45 - GOOGL

• 23:00 - META

• 28:00 - AAPL & The State of AI

What’s Next?

Even though implied volatility remains elevated by historical standards, much of the extreme crash—and even face-ripping rally—pricing has faded for now. Most equity vols have settled back into the 20s, and that shift is showing up clearly in the options market.

Take SPX, for example: current expected moves aren’t pricing a drop back to the early April lows until October. On the flip side, a move back to the prior highs isn’t priced until the end of 2025. That’s a stark shift considering we’ve seen nearly a 13% rally off those April lows and several swings of 7% or more over the span of a few days. In short, options are signaling that a near-term retest of those lows is no longer the market's base case in the near term.

Whether that’s the right call remains to be seen, but these kinds of moments often present a chance to reassess positioning. As Danny Moses put it on today’s MRKT Call podcast: “Use dips to buy quality and use the rips to sell your junk.” That makes a ton of sense as does using rallies to perhaps lay off some upside premium in the form of call spreads, or if we see VIX even lower, perhaps putting some hedges back on to protect any recent buys closer to the lows. 

For tomorrow, Expected Moves: 

• SPX/SPY: 1.25% (extremely low compared to recent weeks, but about double of a low vol / normal market)

• QQQ: 1.5% (also very low vs recent, especially given GOOGL earnings effect)

We also get a Consumer Sentiment update just after the open. 

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