Tariff Preview (Good/Bad/Ugly)

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What’s in Today’s Report:

  • Tariff Preview – Good/Bad/Ugly
  • Table: U.S. Trade Grievances Visualized
  • ISM Manufacturing PMI and JOLTS Takeaways

A modest risk-off move in global markets overnight intensified during the last hour thanks to reports that China is “restricting companies from investing in the U.S.,” adding to trade war angst ahead of Trump’s tariff announcement.

There were not noteworthy economic reports overnight and no market moving headlines aside from the China/U.S. investment news.

Looking into today’s session, traders will be watching several important economic reports including: The ADP Employment Report (E: 120K), Factory Orders (E: 0.5%), and monthly Motor Vehicle Sales (E: 16.0 million) and there is one Fed official scheduled to speak after the close: Kugler (4:30 p.m.ET).

Unless there are any premature tariff details leaked or released ahead of time, however, the market’s main focus today will be on President Trump’s “Make America Wealthy Again” remarks regarding the administration’s tariff plans which are scheduled to be delivered from the Rose Garden at 4:00 p.m. ET.

What worked in the first quarter would continue to work in the second

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What worked in the first quarter would continue to work in the second: Tom Essaye Quoted in Business Insider

Buy the dip or stay defensive? Where to invest as tariffs roil stocks

Tom Essaye, the founder of Sevens Report Research, said what worked in the first quarter would continue to work in the second.

That is, basically everything except for tech, consumer discretionary, communication services, and industrials. Those are the four S&P 500 sectors, out of 11, that are in the red so far this year.

Energy and defensive sectors — which are usually healthcare, utilities, and consumer staples — in particular, should outperform in the months ahead, Essaye said.

“Tariffs are going to continue to cause whiplash, but there are parts of the market that are actually performing pretty well,” he said.

Also, click here to view the full Business Insider article published on April 1st, 2025. However, to see the Sevens Report’s full comments on the current market environment sign up here.

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The name is still too expensive to buy, Essaye said

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The name is still too expensive to buy: Tom Essaye Quoted on Yahoo Finance

Palantir (PLTR) Is Called Too Expensive by Schwab Guests

Similarly, Essaye said that PLTR should be examined “in a context of reasonable valuation.” Although the shares are down a great deal from their highs, the name is still too expensive to buy, Essaye said. He added that the stock is being pressured by worries over the AI sector and fears about lower spending on contracts by Washington.

“Federal contracts are a large part of the company’s business,” Essaye noted.

Expressing his view of PLTR more bluntly, Essaye said that it “can continue to decline,” adding that it would have to drop a great deal more before he would “become interested” in it.

“It’s a good company, but it’s so richly valued that it can fall quite a bit more before value buyers step in,” he warned.

Also, click here to view the full article featured on Yahoo Finance published on April 1st, 2025. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

To strengthen your market knowledge take a free trial of The Sevens Report.

Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

Is the Bond Market Warning About an Economic Slowdown?

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What’s in Today’s Report:

  • Is the Bond Market Warning About an Economic Slowdown?

Markets are trading with a risk-off tone to start Q2 this morning with equity futures modestly lower while safe-haven Treasuries and gold rally as traders look ahead to the Trump administration’s looming tariff announcements.

Economically, China’s March Manufacturing PMI rose to 51.2 vs. (E) 50.6.

In Europe, the March Manufacturing PMI rose to 48.6 vs. (E) 48.7, Narrow Core HICP fell to 2.4% vs. (E) 2.6% y/y, and the UE Rate fell to 6.1% vs. (E) 6.2%.

The mostly encouraging global economic data overnight is helping drive overseas equity markets higher this morning despite the weakness in U.S. futures.

Looking into today’s session, a busy week of domestic economic data releases kicks off with the ISM Manufacturing Index (E: 49.6) and JOLTS (E: 7.6 million) both due to be released shortly after the bell.

Additionally, there is one Fed speaker: Barkin (9:00 a.m. ET). Investors will be looking for a dovish tone from Barkin and “Goldilocks” economic data with stable growth and evidence of cooling or at least steady inflation pressures.

 

Sevens Report Quarterly Letter Delivered Today

Our Q1 ’25 Quarterly Letter will be released today.

We use our strength (writing about the markets) to help you:

  • Save time (an average of 4-6 hours per quarterly letter)… and
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You can view our Q4 ’24 Quarterly Letter here. To learn more about the product (including price) please click this link.  If you’re interested in subscribing, please email info@sevensreport.com.

 

Tariff Week

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What’s in Today’s Report:

  • Tariff Week
  • Weekly Market Preview:  All About Tariffs (How Bad Will It Be?)
  • Weekly Economic Cheat Sheet:  Is the U.S. Economy Rolling Over?  (We Get the Big Three Economic Reports This Week)

Futures are sharply lower as articles over the weekend implied the looming tariff announcements could be both chaotic and more far-reaching than previously thought.

The WSJ, Politico, New York Times and others warned the administration’s tariff policy 1) Isn’t yet finalized (raising fears of more policy whiplash) and 2) Is more intense than articles implied last week.

Economically, Chinese economic data was good as March manufacturing and services PMIs both beat estimates.

This week is a potentially pivotal one for markets with Wednesday’s looming tariff announcements and key economic data but it starts slowly as there are no notable reports today.  As such, we can expect tariff preview articles to drive trading (and the more articles point to intense tariffs, the lower stocks will go).

New ETFs for Your Watchlist

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What’s in Today’s Report:

  • New ETFs for Your Watchlist
  • GDP Details Point to Economic Weakness Emerging in Q4

U.S. equity futures are flat to lower this morning as traders continue to digest this week’s fluid tariff and trade war developments ahead of critical domestic inflation data.

Economically, Germany’s GfK Consumer Climate Index came in at -24.5 vs. (E) -22.0 while the official German Unemployment Rate ticked up 0.1% to 6.3% vs. (E) 6.2%. The downbeat German data is weighing on EU markets.

Today, focus will be on inflation data early with the Fed’s preferred inflation metric due out ahead of the bell: PCE Price Index (E: 0.3% m/m, 2.5% y/y), Core PCE Price Index (E: 0.3% m/m, 2.7% y/y). A cooler-than-expected or in-line number will be well-received by investors.

Then after the open, the University of Michigan’s Consumer Sentiment Index will be released (E: 57.9, 1-Yr Inflation Expectations: 4.9%) and markets will want to see a stabilizing headline and steady or lower 1-Yr inflation expectations in order for markets to stage a rebound.

Finally, there are two Fed speakers this afternoon: Barr (12:15 p.m. ET) and Bostic (3:30 p.m. ET). Fed speak has been on the hawkish/cautious side this week so any encouraging commentary or a dovish tone would be welcomed, especially in the wake of “cool” inflation data.

Sentiment Update: A Somewhat Shocking Discovery

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What’s in Today’s Report:

  • Sentiment Update: A Somewhat Shocking Discovery
  • February Durable Goods Takeaway
  • EIA Data Takeaways and Oil Update

U.S. futures are lower with most global equity markets this morning as President Trump announced fresh details about automobile tariffs and other new trade policies after the close yesterday, further raising trade war angst.

Economically, Chinese Industrial Profits edged down -0.3% in February, an improvement from January’s -3.3% print, but the report was not enough to offset tariff worries.

Today, market focus will be on economic data early in the day with Final Q4 GDP (E: 2.4%), Jobless Claims (E: 225K), International Trade in Goods (E: $-135.5B), and Pending Home Sales (E: 2.9%) all due to be released.

Additionally, there is one Fed speaker: Barkin (4:30 p.m. ET) and a few more late-season earnings reports due from SNX ($2.91) and LULU ($5.87) that could move markets (but likely will not given the focus on global trade policies right now).

Charles Dow Would Be Selling Stocks Now

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What’s in Today’s Report:

  • Charles Dow Would Officially Be Selling Stocks Now
  • Consumer Confidence Takeaways – Another Survey-Based Whiff of Stagflation

Futures are slightly lower after a mostly quiet night of news as this week’s so-far-solid gains are digested with investors weighing favorable inflation data out of Europe against simmering tariff uncertainties.

Economically, U.K. CPI fell from 3.0% to 2.8% vs. (E) 2.9% in February with Core CPI down from 3.7% to 3.5%.  The “cool” inflation data is helping U.K. markets outperform European peers this morning.

Today, there is one noteworthy and potentially market-moving economic report due out ahead of the open: Durable Goods Orders (E: -1.0%). A “Goldilocks” report that is no worse than expected should help equities maintain WTD gains while a “too hot” or “too cold” print could spark some profit taking given the tentative nature of this week’s advance.

Additionally, there are two Fed speakers today: Kashkari (10:00 a.m. ET) and Musalem (1:10 p.m. ET), as well as a 5-Yr Treasury Note auction at 1:00 p.m. ET. Less-hawkish commentary from the Fed officials and healthy but not urgent demand for the 5-Yr Notes should be well-received by investors today.

Finally, there are a few noteworthy, late-season earnings reports due out today from DLTR ($2.18), CHWY ($3.19), and JEF ($0.88), but none are likely to have a material impact on the broader market.

Hard Landing/Soft Landing Scoreboard

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What’s in Today’s Report:

  • Hard Landing/Soft Landing Scoreboard
  • Composite PMI Flash Takeaways – Another Whiff of Stagflation

Futures are back to flat after trading lower overnight on profit taking as traders digest the latest trade war headlines and subsequent rally off the 2025 stock market lows.

Economically, Germany’s Ifo Survey was mostly upbeat as the headline Business Climate Index firmed to 86.7 vs. (E) 87.0 and Business Expectations jumped to 87.7 vs. (E) 86.8. The solid data is helping support gains in EU markets.

Looking into today’s session, there are several economic reports due to be released starting with a few housing market releases: Case-Shiller Home Price Index (E: 4.5%), the FHFA House Price Index (E: 0.2%), and New Home Sales (E: 679K).

Then after the open, the most important economic report of the day is due out: Consumer Confidence (E: 94.2) and investors will want to see a less-dismal data set in the survey-based release as the February consumer reports weighed heavily on risk assets.

Additionally, there is one Fed speaker: Williams (9:05 a.m. ET) and a few late-season earnings reports from MKC ($0.64 and GME ($0.09), but neither are likely to move markets today.

 

Sevens Report Q1 ’25 Quarterly Letter Coming Next Tuesday

Investor sentiment is literally at all-time lows, markets are volatile, and clients are nervous. Now is the time to remind them that long-term plans can overcome periods of volatility! 

One of the easiest and best ways to do that is with a quarterly letter, and we will be releasing the Q1 2025 Sevens Report Quarterly Letter to subscribers next Tuesday, April 1st. 

The Sevens Report Quarterly Letter is a turn-key client communications solution. We use our strength (writing about the markets) to help you:

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We should expect continued volatile markets

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Sanctions on Iran announced Monday invited a modest bid to the market: Tyler Richey Quoted in Market Watch

Stocks up sharply as tariff angst eases, but traders see more uncertainty ahead

“Until trade and tariff policy are known and consistent and we get a break from the dramatic overhaul of the Federal government, we should expect continued volatile markets and be aware that this pullback likely isn’t over,” said Tom Essaye, founder of Sevens Report Research, in a note.

Also, click here to view the full MarketWatch article published on February 24th, 2024. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

To strengthen your market knowledge take a free trial of The Sevens Report.

Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.