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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.

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.

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).

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.

That marks the start of what could be a crippling trend of declining demand

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That marks the start of what could be a crippling trend of declining demand: Tyler Richey Quoted in Market Watch

U.S. oil supplies rise sharply, and trade-war ‘angst’ may be to blame for a drop in demand

“If that drop in demand is being fueled by tariff worries and trade-war angst … then that marks the start of what could be a crippling trend of declining demand that would, barring supply-side surprises, spark a selloff in oil,” Tyler Richey, co-editor at Sevens Report Research, told MarketWatch. That could see U.S. benchmark prices begin to sell off toward the downside target of between $57 and $58 a barrel, he said. May West Texas Intermediate crude was up 21 cents, or 0.3%, at $71.41 a barrel, after losing 0.4% Tuesday.

Also, click here to view the full MarketWatch article published on April 2nd, 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.

Dow Theory flipped to a bearish signal

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Dow Theory flipped to a bearish signal: Sevens Report Analysts Quoted in Investing.com

Warning: ’Dow Theory’ flips from bullish to bearish for first time since July 2023

According to the Sevens Report, Dow Theory flipped to a bearish signal on March 14, ending a bullish stretch that began in July 2023.

“A bearish reversal in Dow Theory effectively means that the bull market off the October 2022 lows has either ended or is in the process of ending,” the report said. While the S&P 500 remains near multi-week highs, the signal implies rising downside risks as macro uncertainty builds.

The system has a reputation for lagging but historically offers “a relatively high conviction bullish or bearish call for the primary trend in the stock market once a reversal is ‘confirmed’,” Sevens Report explained.

Importantly, Sevens Report stresses that the signal is not just a technical indicator. “If everything is priced in and both the Dow Industrials and Dow Transports have or are in the process of falling into technical downtrends, then the economy is very likely already in contraction and falling into recession, based on history.”

Also, click here to view the full article featured on Investing.com published on March 26th, 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 Tariff Announcement A Bearish Gamechanger?

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What’s in Today’s Report:

  • Is the Tariff Announcement A Bearish Gamechanger?
  • Jobs Report Preview

Global markets are sharply lower as S&P 500 futures fall three percent in response to President Trump’s worse than feared reciprocal tariff announcement.

President Trump announced baseline 10% tariffs on virtually all imports and dramatically higher tariffs on numerous major trading partners, dramatically intensifying the global trade war and spiking global recession concerns.

Today focus will remain on trade and any hint that the announced tariffs could be negotiated lower will help stocks bounce, while the administration dismissing negotiations will only add more downward pressures to markets.

Away from trade, there are several important economic reports today including Jobless Claims (E: 226K) and the ISM Services PMI (E: 53.0).  If those numbers disappoint, the selling will get worse as recession fears surge.  Finally, there are two Fed speakers today, Jefferson (12:30 p.m. ET) and Cook (3:30 p.m. ET), although they shouldn’t move markets.

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.

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.