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A Wildcard to Watch: Legal Challenges to Trump’s Tariffs

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What’s in Today’s Report:

  • Wildcard to Watch: Legal Challenges to Trump’s Tariffs
  • The “Rest of the Market” Continues to Outperform – Chart

Stock futures are wavering between gains and losses this morning as traders digest potential tariff relief for auto imports and position into more mega-cap earnings reports.

Economically, Germany’s GfK Consumer Climate Index rose to -20.6 vs. (E) -25.5, helping German markets outperform with the DAX up ~0.75% this morning.

Today, focus will be on economic data early with International Trade in Goods (E: $-142.0B), Case-Shiller Home Price Index (E: 4.7%), FHFA House Price Index (E: 0.3%), Consumer Confidence (E: 87.5), and JOLTS (E: 7.464 million) data all due to be released.

Earnings season also continues today with noteworthy companies reporting results including: PYPL ($1.15), UPS ($1.42), KO ($0.71), V ($2.68), and SBUX ($0.49).

There were several legitimate reasons for last week’s rally

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There were several legitimate reasons for last week’s rally: Sevens Report Analysts Quoted in Investing.com

Can Trump’s “Happy Talk” keep the S&P 500 above 5,500? Strategist weighs in

According to Sevens Report, “there were several legitimate reasons for last week’s rally, including (in order of importance): De-escalation of the trade war with China, de-escalation of the Trump/Powell feud, rising anticipation for the announcement of numerous trade deals, and solid Q1 earnings.”

However, Sevens Report cautioned that “none of these events are materially bullish,” and warned that while “still-negative sentiment helped the S&P 500 temporarily break through 5,500 on some good earnings or further trade de-escalation briefly, I do not think the news has turned good enough to sustain a rally.”

“Trump understands that firing Powell would hammer markets, so he (probably) won’t try it, but that doesn’t mean the negative headlines are done,” Sevens Report said.

They added, “The Fed meets next on Wednesday, May 7, and the Fed is very unlikely to cut rates at that meeting and that could draw Trump’s ire.”

On the trade front, Sevens Report noted that while tariff reductions are better than escalation, “the baseline level of tariffs will be much higher than it was in January and that will be a headwind on growth and a tailwind on inflation.”

Looking ahead, Sevens Report stated, “it is very unlikely that 2025 S&P 500 EPS expectations stay at $270,” suggesting that “a $10/share reduction to $260 (or even lower) seems more appropriate.”

Also, click here to view the full article featured on Investing.com published on April 28th, 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.

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.

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.

Can Trump’s “Happy Talk” Keep the S&P 500 Above 5,500?

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What’s in Today’s Report:

  • Can Trump’s “Happy Talk” Keep the S&P 500 Above 5,500?
  • Weekly Market Preview:  More Insight on Tariff Fallout (Important Earnings and Economic Data)
  • Weekly Economic Cheat Sheet:  Jobs Report on Friday and ISM Manufacturing on Thursday are Key Reports to Watch

Futures are modestly weaker following a mostly quiet weekend of news as investors await more clarity on trade deals and insights on how much damage tariffs will do to the economy.

There were no new trade headlines over the weekend (not even notable social media posts) although investors are hopeful trade deals will be announced soon, possibly this week.

Today markets should be quiet (assuming no trade surprises) as there is no notable economic data, no Fed speakers and just one notable earnings report, NXPI ($2.18).  However, don’t let the slow start fool you, as this will be a very busy week of important earnings (AMZN, AAPL, META, MSFT, V) and economic data and as the week moves on, the busier it will get.

Reading Market Volatility: If, Then.

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What’s in Today’s Report:

  • Reading Market Volatility:  If, Then…

Futures are little changed despite solid earnings overnight and more signs of trade war de-escalation.

GOOGL posted stronger than expected results and tech earnings broadly last night were solid, boosting the sector.

On trade, China exempted several categories of U.S. imports from 125% tariffs in a further small de-escalation of trade tensions.

Trade headlines will continue to dominate intra-day trading today but there’s also a notable economic report this morning via University of Michigan Consumer Sentiment (E: 50.8).  The key part of this report will be the inflation expectations and estimates are as follows: One Year Inflation Expectations: 6.7%, Five-Year Inflation Expectations 4.4%.  If the actual data is hotter than those estimates, it will put upward pressure on yields and could weigh on stocks.

On earnings, results so far have been better than expected and that has helped this rally.  Notable results today include: ABBV ($2.40),  CHTR ($8.53) and PSX ($-0.77).

The Gold-to-Silver Ratio (GSR) is a simple and compelling measure

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The Gold-to-Silver Ratio (GSR) is a simple and compelling measure: Tom Essaye Quoted in Investing.com

Are silver prices set for a breakout?

Silver may be setting up for a breakout, according to Sevens Report’s Tom Essaye, who highlights a rare divergence between gold and silver pricing that could soon correct in favor of the latter.

“The Gold-to-Silver Ratio (GSR) is a simple and compelling measure with historical significance. It tells you how many ounces of silver it takes to buy one ounce of gold. Today, that number is around 100:1,” Essaye said in a Thursday report.

Essaye emphasizes that silver is increasingly seen as the “people’s gold,” while also benefiting from strong industrial drivers.

Demand is growing “due to electric vehicles, which use more silver than traditional cars.” Moreover, Essaye highlights solar panels, one of the fastest-growing sources of silver demand, electronics, 5G technology, medical devices, and defense systems.

Even with these tailwinds, silver prices have yet to revisit their 2011 highs near $50. “Silver hasn’t even returned close to its all-time high of $49.95 during this current precious metals’ bull run,” Essaye said.

“Typically, it runs between 40:1 and 60:1, and it doesn’t get above 100 very often,” he added.

Also, click here to view the full article featured on Investing.com published on April 24th, 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.

Hard Landing/Soft Landing Scoreboard (Hard Data Holding Up)

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What’s in Today’s Report:

  • Hard Landing/Soft Landing Scoreboard: Hard Data Is Hanging in There

U.S. stock futures are solidly higher this morning with mega-cap tech leading while bonds are stabilizing after President Trump dialed back rhetoric about firing Fed Chair Powell and made encouraging comments on trade deal progress while TSLA is up 6%+ after Q1 earnings.

Economically, the EU Composite Flash PMI fell to 50.1 vs. (E) 50.4,in April down from 50.9 in March amid weakness in the Services index but investors are taking the disappointing data in stride, instead focusing on the reported trade deal progress.

Today, economic data in the U.S. will be in focus early in the day with the Flash Manufacturing PMI (E: 49.4) and Flash Services PMI (E: 52.5), as well as New Home Sales (E: 682K) data due to be released shortly after the open.

There are also multiple Fed speakers to watch today including: Goolsbee (9:00 a.m. ET), Waller (9:35 a.m. ET), and Hammack later in the day (6:30 p.m. ET).

There is a 5-Yr Treasury Note auction at 1:00 p.m. ET that could impact bond markets and in turn move stocks in the early afternoon. The stronger the auction results the better after the recent rout in Treasuries.

Finally earnings season continues with notable releases due out from: BA ($-1.54), T ($0.52), IBM ($1.42), and CMG ($0.28).

The market is dying for any breadcrumb of positivity

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The market is dying for any breadcrumb of positivity: Tom Essaye Quoted in Inc.com

The Stock Market Is Desperate for Any Excuse to Rally

“The market is dying for any breadcrumb of positivity,” says Tom Essaye, the founder of Sevens Report Research. “The market is flailing around.”

Also, click here to view the full article featured on Inc.com, published on April 23rd, 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.

Erode this idea of solid structure of the government

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Erode this idea of solid structure of the government: Sevens Report Analysts Quoted in Investing.com

Trump attacks on Powell a “potentially large negative” for markets – Sevens Report

In a note to clients, the Sevens Report analysts argued that if Trump moves to encroach on the Fed’s independence, it could lead to a legal showdown that would exacerbate recent worries over an uncertain business outlook, and possibly send the benchmark S&P 500 down below 5,000.

“Put plainly, global investors buy U.S. assets and come to the U.S. to innovate because they know the rules (the court system is well established and broadly viewed as impartial) and these rules don’t change based on the latest elections or on which power is in control in Washington,” the analysts wrote.

Trump’s recent scathing attacks on Powell, however, “erode this idea of solid structure of the government and as such, erode the idea of American economic exceptionalism,” they added.

Also, click here to view the full article featured on Investing.com published on April 22nd, 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.

Trump Attacking Powell Is a Potentially Large Negative

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What’s in Today’s Report:

  • Trump Attacking Powell Is a Potentially Large Negative
  • Chart – Dollar Index’s 10% YTD Decline Underscores U.S. Policy Uncertainty

Equity futures are solidly higher in pre-market trade as investor focus shifts from political tensions to earnings as we approach the peak of the Q1 reporting season.

There were no noteworthy economic reports overnight and there is just one lesser-followed economic report due out in the U.S. today: Richmond Fed Manufacturing Index (E: -5.0) which is unlikely to materially move markets.

There are several Fed officials scheduled to speak today including Jefferson (9:00 a.m. ET), Harker (9:30 a.m. ET), Kashkari (1:40 p.m. ET), and Barkin (2:30 p.m. ET). Given Trump’s recent attacks on Powell’s Fed leadership, their comments have the potential to trigger risk-on or risk-off money flows in intraday trade today.

In the afternoon, there is a 2-Yr Treasury Note auction at 1:00 p.m. ET. Because the 2-Yr is viewed as a “policy-rate-sensitive” Treasury security, the level of demand for the Notes could lead to yield swings that could ultimately impact the stock market.

Finally, earnings season is in full swing this week with notable quarterly results due from VZ ($1.15), GE ($1.26), LMT ($6.32), TSLA ($0.35), and COF ($3.70) today. There will be particular focus on guidance, forecasts, and commentary from leadership as forward earnings expectations have both deteriorated and become increasingly uncertain since the start of the year.