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How much economic damage have tariffs done?

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How much economic damage have tariffs done?: Tom Essaye Quoted in MarketWatch

Is the stock market overvalued? Investors look for ‘economic damage’ from tariffs

Investors are hoping trade deals that reduce tariffs may be announced soon, which would help inform whether the U.S. stock market is currently overvalued, according to Tom Essaye, founder and president of Sevens Report Research.

“‘How much economic damage have tariffs done?’ is one of the most important questions for investors right now because if the answer is ‘a lot,’ then this market is still substantially overvalued,” Essaye said in a note Monday. “If the answer is ‘not too much’ and tariff reduction occurs, then the case can be made for a sustainable rally (as long as we get consistent policy).”

Also, click here to view the full article featured on MarketWatch published on April 28th, 2025. However, to see the Sevens Report’s full comments on the current market environment sign up here.

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Is Silver Set to Breakout?

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What’s in Today’s Report:

  • Is Silver Set to Breakout?

Futures are modestly weaker on digestion of this week’s rally and on mildly disappointing trade news.

Chinese officials stated there were no ongoing trade talks with the U.S. and again called for the removal of tariffs, pushing back on the “progress” narrative of the past few days.

Focus today will be on economic data and earnings.  On the data front, the key reports today include Durable Goods (E: 1.4%), Jobless Claims (E: 220K) and Existing Home Sales (E: 4.12 million) and if this “hard” data remains solid it will push back against slowdown concerns.    There is also one Fed speaker, Kashkari (5:00 p.m. ET), but he shouldn’t move markets.

On earnings, the key reports today include GOOGL ($2.02), INTC ($-0.14) and PG ($1.54).  For GOOGL and INTC, guidance will be key while investors will wait to see the impact of tariffs on PG’s quarter.

Why This Is (Likely) A Rangebound Market

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What’s in Today’s Report:

  • Why This Is (Likely) A Rangebound Market
  • Weekly Market Preview:  Earnings in Focus (Will Corporate America Confirm Investors’ fears?)
  • Weekly Economic Cheat Sheet:  Is Uncertainty Pressuring Economic Growth Yet?

Futures are sharply lower (down around 1%) following the holiday weekend as rising tension between Fed Chair Powell and President Trump pressured sentiment.

On Friday, National Economic Director Hasset said the White House was studying if Powell can be fired, adding another potential source of uncertainty to the markets.

Today volumes will be low given many global markets (including the UK, EU, Hong Kong and Australia) are closed.  But, there is one economic report, Leading Indicators (E: -0.3%) and one Fed speaker Goolsbee (8:30 a.m. ET).  Any data that implies stable growth and a dovish Fed should help support stocks.

Bitcoin’s 2025 downtrend line was violated earlier this month

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Bitcoin’s 2025 downtrend line was violated earlier this month: Sevens Report Co-Editor, Tyler Richey, Quoted in MarketWatch

Bitcoin could rise back toward $100,000 if this happens, as dollar and stocks fall while gold rises

From the technical perspective, bitcoin’s 2025 downtrend line was violated earlier this month while the relative strength index, a momentum indicator, showed a bullish divergence, according to Tyler Richey, technical analyst and co-editor at the Sevens Report. It suggests that bitcoin may see a rise back toward $100,000 if the market can break above its highs in late March at near $88,000, Richey said. 

Bitcoin Chart

Also, click here to view the full article featured on MarketWatch published on April 21st, 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.

Why Powell Caused Stocks to Drop

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What’s in Today’s Report:

  • Why Powell Caused Stocks to Drop

Futures are moderately higher on positive trade headlines and strong tech earnings.

President Trump posted on social media that “Big Progress” has been made in a trade deal with Japan and that’s helping stocks rally (although details were light).

On earnings, TSM beat earnings and boosted guidance and provided some needed good news for the tech sector.

Today there are several economic reports including, on order of importance, Jobless Claims (E: 225K), Philly Fed (E: 6.7) and Housing Starts (1.420M).  As has been the case, markets will be looking for solid data that pushed back on the slowdown narrative.  We also have one Fed speaker, Barr (11:45 a.m. ET), but he shouldn’t move markets.

Earnings season continues to heat up, meanwhile, and important reports today include UNH ($7.27), AXP ($3.46) and NFLX ($5.74).

Sentiment Update (A Shocking Discovery)

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What’s in Today’s Report:

  • Sentiment Update (A Somewhat Shocking Discovery)
  • Empire State Manufacturing Survey Takeaways

U.S. stock futures are in the red this morning with tech leading to the downside after the U.S. announced new export restrictions on AI chip exports to China.

Economically, Chinese GDP missed (1.2% vs. E: 1.5% q/q) but Retail Sales beat (5.9% vs. E: 4.2%) while EU HICP (CPI equivalent) was inline with estimates at 2.2% y/y.

Looking ahead to today’s session, there are several important economic reports due to be released in the U.S. including: Retail Sales (E: 1.4%), Industrial Production (E: -0.2%), and the Housing Market Index (E: 38).

Additionally, there are two Fed officials scheduled to speak: Hammack (12:00 p.m. ET) and Schmid (7:00 p.m. ET) and the Treasury will hold a 20-Yr Bond auction at 1:00 p.m. ET.

Finally, earnings season continues with quarterly results due from ASML ($6.12), USB ($0.99), PGR ($4.72), CFG ($0.75), AA ($1.73), and CSX ($0.37) today.

What Happens If Markets Tire of Trade Headlines?

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What’s in Today’s Report:

  • What Happens If Markets Tire of Trade Headlines
  • NY Fed Inflation Expectations (Chart)

Futures are slightly higher on news that President Trump is considering a “tariff pause” for automobile imports which offset reports that China is halting U.S. aircraft imports.

Economically, the German ZEW Survey was mixed as Current Conditions were better than feared at -81.2 (E: -86.0), while Economic Sentiment badly missed at -14 (E: 10.0) which underscores the still broad sense of global economic uncertainty.

Today, focus will be on economic data early with the Empire State Manufacturing Index (-10.0) and Import & Export Prices data (E: 0.0% m/m, 0.1% m/m) due to be released before the bell.

Additionally, there is one Fed speaker to watch mid-day: Barkin (11:35 a.m. ET) and earnings season continues with several important companies reporting quarterly results including BAC ($0.81), C ($1.84), JNJ ($2.57), and UAL ($0.80).

April Market Multiple Table Update

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What’s in Today’s Report:

  • April Market Multiple Table Update
  • Chart – March Small Business Optimism Turns Sharply Lower

Futures are recovering from overnight losses as investors await China’s reaction to the latest wave of tariffs that went into effect overnight amid otherwise quiet news flow.

Economically, there were no market-moving reports overnight, however the Reserve Bank of New Zealand did cut their policy rate by 25 bp (3.75%), meeting expectations.

There are no notable economic reports today which will leave investors largely focused on trade war developments and tariff headlines today.

Outside of tariff news, traders will be watching a 10-Yr Treasury Note auction at 1:00 p.m. ET as well as the March FOMC meeting minutes which will be release at 2:00 p.m. ET.

Finally, there is one Fed officials scheduled to speak: Barkin (12:30 p.m. ET). Any less discouraging commentary will be welcomed by markets today.

What Makes It Better & What Makes It Worse

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What’s in Today’s Report:

  • What Makes It Better & What Makes It Worse

U.S. equity futures are stabilizing and market volatility is easing modestly thanks to some positive tariff news overnight.

On the trade war front, optimism about tariff negotiations between the U.S. and Japan sent the Nikkei higher by 6%+ while Chinese shares rallied after the PBOC pledged stimulus efforts to shore up financial markets amid recent volatility.

Economically, the NFIB Small Business Optimism Index fell to a new post-election low of 97.4 vs. (E) 98.9 in March, the latest report to highlight deteriorating business confidence (dovish for Fed policy outlook).

There are no notable economic reports today however the Treasury will hold a 3-Yr Note auction at 1:00 p.m. ET. A strong auction will reiterate last week’s dovish shift in Fed policy outlook amid growing economic uncertainty and add to prospects that a sustainable relief rally is taking shape.

Finally, there is one Fed official scheduled to speak today: Daly (2:00 p.m. ET) and investors will be looking for more encouraging commentary about the outlook for the economy (but without taking a hawkish tone).

 

It’s Not Too Late to Send Clients A Quarterly Letter!

Market volatility has surged in the wake of tariffs and clients are nervous.  If you are behind, please let us help! Our Q1 ’25 Quarterly Letter was delivered to subscribers last week, complete with compliance backup and citations.

We continue to get feedback about how it is saving advisors time and helping them communicate with their clients in this volatile environment!

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.

Bull vs. Bear: Which Argument Makes More Sense?

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What’s in Today’s Report:

  • Bull vs. Bear:  Which Argument Makes More Sense?
  • Weekly Market Preview:  Will There Be Any Tariff Relief?
  • Weekly Economic Cheat Sheet:  Focus Turns to Inflation (CPI on Thursday)

Futures are sharply lower again (down close to 2%) as there was no meaningful tariff relief over the weekend while administration officials reiterated their support for the current tariff policy.

Trump, Bessent and Lutnick all downplayed the market declines and doubled down on the current tariff policy.

On tariff relief, Vietnam, Japan, the UK and others expressed a desire to negotiate tariffs lower, but nothing concrete occurred.

Today focus will remain on tariff headlines and any headlines that imply tariff relief could cause a sharp rebound, given the intensity of the recent declines.  There is one Fed speaker today, Kugler (10:30 a.m. ET), but she shouldn’t move markets.