MARKET WRAP

Equities gave back about a 1/3 of yesterday’s historic rally. It was another day with wild swings that saw the SPX down more than -5% at its intraday lows. At the close the SPX was -3.5%, QQQ -4.2% and IWM -4.3%. The 10Y yield was higher, now 4.41% while Oil was lower, now back near $60. The action in the dollar is of some concern now, with DXY down nearly -2% today. Gold resumed its safe haven status, up +3.5% to new highs. The VIX closed back above 40. Tomorrow morning we get PPI, UoM Consumer Sentiment as well as JPM, WFC and MS reporting earnings. Of course tariff headlines remain possible each day.

• RiskReversal Pod: Peter Boockvar joins Guy and Dan to discuss bond market volatility, earnings estimates, crude oil, gold, the weakening U.S. dollar, the impact of international relations on US treasuries and more.

• MRKT Call: Carter Joins to highlight the long term SPX channel dating back to the GFC and discussions of historical P/E ratio. Dan answers a slew of your questions.

MRKT MATRIX: April 10, 2025

Today’s Top Stories:

• Dow tumbles 1,000 points as tariff sell-off resumes following one-day reprieve (CNBC)

• Full S&P 500 Recovery This Year Still Far-Fetched Despite Rally (Bloomberg)

• Why the Trade War Isn’t Over for America’s Biggest Banks (WSJ)

• Fed Leans Against Inflation and Away From Preemptive Rate Cuts (Bloomberg)

• Auto Tariffs Are Still On–and Would Raise the Cost of Just Owning a Car (WSJ)

• Tesla gets price target cut from three Wall Street shops (CNBC)

• GM, Ford Shares Downgraded as Banks Warn of Tariff Impact (Bloomberg)

• Amazon CEO Andy Jassy says he believes sellers will pass increased tariff costs on to consumers (CNBC)

• TSMC Sales Grow 42% on Soaring AI Demand Ahead of US Tariffs (Bloomberg)

Today’s MRKT Call is Presented by SoFi

Stocks Sink After Trump Tariff Pause Sparks Historic Rally

Carter joins to talk the latest chart levels following yesterday’s bounce and a historical channel from the GFC and Covid lows (4200 SPX is the bottom of that channel)

• Analysis: SPX, JPM, WFC, MS, BKX, XLF, DXY, AMZN, PANW, AAPL, VIX, IWM, NVDA

• Call of the Day: Doug Kass on yesterday being a bear market bounce

• Chart of the Day: Sofi’s latest: 1) Stats on the best days in market history come within days of the worst days. 2) P/E revisions since March 9th

• Your Questions Answered: 

  • Please talk about the dollar, this sell-off is getting intense.

  • Who is oil getting hit so hard? Recessions from tariffs or something more?

  • What does market breadth mean?

  • Would you avoid stocks with a lot of short interest?

  • Will NVDA continue lower from here?

  • What’s a good level to buy PANW?

  • Opinion on dipping into small caps on the long side soon?

  • VIX as a buy indicator?

  • Thoughts on AMZN?

  • Will AAPL get a tariff exemption?

Sign up below to receive daily MRKT Call reminders and early access to the charts featured in the show.

Today’s RiskReversal Podcast is Presented by Betterment and RBC

Trump Tariff Pause, Now What? with Peter Boockvar

Dan Nathan is joined by Peter Boockvar, CIO at Bleakly Advisors and editor of The Boock Report, to discuss the market's response to recent tariff announcements by the president. They talk about bond market volatility, earnings estimates, and the reaction from risk assets like crude oil, gold, and the U.S. dollar. Peter provides an in-depth analysis of the tariffs on steel, aluminum, and auto imports, and the temporary 90-day respite on reciprocal tariffs excluding China. The discussion also covers potential long-term impacts on trade relations, market fragility, and the shift in global economic dynamics, especially concerning China. They emphasize the market's underlying issues preceding the tariffs and question the sustainability of the current rally given ongoing economic uncertainties.

After the break, Guy Adami and Peter explore the dramatic shifts in bond yields, the complexities of the current economic situation, and the implications of tariffs on global trade. Peter breaks down the traditional treasury trades, the impact of international relations on US treasuries, and the potential market reactions to various economic policies. The discussion also covers the weakening dollar, de-leveraging in the market, and the potential for a slowdown in the economy. They emphasize the importance of a disciplined approach to market analysis amidst unprecedented market movements and political maneuvers.

What’s Next?

Tomorrow morning we get the second leg of this week’s inflation data with the PPI as well as Consumer Confidence numbers. Expected moves for the day are as follows:

• SPX/SPY: 2.7%

• QQQ: 2.9%

• IWM: 3%

• TLT: 1.8%

As a constant reminder in this high volatility backdrop, intraday moves are going way beyond where they typically would as market participants that are short gamma have to chase these moves. Patience and a gameplan for buys and sells are key. They have to chase, you do not.

Tomorrow morning also kicks off what will be a fascinating quarterly earnings report season with a couple of the big banks leading the way before the open. Here are the current expected moves for some of the companies reporting in the AM:

• JPM: 5%

• WFC: 5.6%

• MS: 5.5%

• BLK: 4.6%

Under normal circumstances these names would be pricing in an earnings moves somewhere in the 3 to 3.5% range. The elevated expected moves for tomorrow are multi fold. The first is that  there’s some uncertainty in banking at the moment given the global turmoil. The second is the overall market volatility. When the VIX is 40 and 5% market swings are the norm, that can accelerate an earnings move if it happens to be in the same direction (and really limit a move if it’s in the opposite direction of the market). In other words, it doesn’t matter if JPM beats or misses if the SPX is +/-5% on completely unrelated news, it will get dragged along with the market to some extent. 

In a bubble, the expected moves are likely too large. But that would be totally dependent on no large swings in the market tomorrow, which is possible, but given that JPM has had a more than 10% range over the past two sessions without reporting earnings, you can see how much of that expected move is simply market volatility.

One thing that can be said is that the upper bound of the expected range in JPM is just above yesterday afternoon’s highs. That may be difficult for the stock to do without immediately finding sellers (barring a large move higher in the SPX.) To the downside it’s near the level the stock was trading before the gap higher on the “90 day pause” tweet. 

Subscribe to the RiskReversal YouTube Channel and drop a comment/like to show your support

Want to check out past podcast episodes? Go to wherever you get your podcasts and type in “RiskReversal Media”

We want to hear your feedback! Reply to this email with any comments or questions