Market Overview

The stock market experienced a sharp selloff today following President Donald Trump's announcement of sweeping tariffs on nearly all U.S. trading partners. The Dow Jones Industrial Average plunged more than 1,500 points, the Nasdaq Composite slumped 6.0%, and the S&P 500 fell 4.8%.

Tariff Details

- A 10% tariff was imposed on global imports, effective April 5. - Higher rates were imposed on specific countries, effective April 9: - China: Additional 34% on top of the existing 20% - Japan: 24% - Vietnam: 46% - India: 26% - EU: 20%

Market Impact

- Small-cap Russell 2000 sank 6.6%. - Large-cap tech and many discretionary-related industries faced heavy selling pressure. - Apple (AAPL, Financial) dropped 9.3%, and NVIDIA (NVDA, Financial) fell 7.8%, dragging down semiconductor shares. - Oil prices decreased due to demand concerns, with WTI crude falling to $67/bbl. The energy sector declined by 7.5%, technology by 6.9%, and discretionary by 6.5%.

Bond Market Reaction

As stocks slid, Treasuries surged, leading to sharply lower rates: - The 10-year yield dropped 14 basis points to 4.06%. - The 2-year yield dropped 18 basis points to 3.72%.

Economic Data Review

- Weekly Initial Claims: 219K (consensus 224K); revised prior 225K. - Weekly Continuing Claims: 1.903 million; revised prior 1.847 million. - Initial claims remained low, but continuing claims increased to their highest level since November 2021, indicating difficulty in returning to work. - February Trade Balance: -$122.7 billion (consensus -$121.0 billion); revised prior -$130.7 billion. - The trade deficit narrowed slightly but remained at record levels due to pre-tariff purchases.- March S&P Global US Services PMI: Final 54.4; prior 54.3. - March ISM Services: 50.8% (consensus 53.2%); prior 53.5%. - Growth in the services sector slowed notably in March, with employment contracting for the first time since September.

Upcoming Economic Data

Market participants are anticipating the March Employment Situation report, which will be released at 8:30 ET tomorrow.

Global Market Performance

- Europe: - DAX: -3.1% - FTSE: -1.6% - CAC: -3.3% - Asia: - Nikkei: -2.8% - Hang Seng: -1.5% - Shanghai: -0.2%

Commodities

- Crude Oil: -4.70 @ 67.03 - Natural Gas: +0.08 @ 4.13 - Gold: -44.40 @ 3121.90 - Silver: -2.61 @ 31.01 - Copper: -0.22 @ 4.83

AAPL,NVDA

Today's News

President Trump's recent announcement of sweeping tariffs has sent shockwaves through global financial markets, significantly impacting U.S. stocks. The tariffs, which include a minimum baseline rate of 10%, have raised fears of a global trade war, leading to a dramatic selloff. Major indices, including the S&P 500, Nasdaq Composite, and Dow Jones, experienced substantial declines, with the S&P 500 erasing approximately $1.7 trillion in market capitalization. Investors sought refuge in U.S. debt, pushing prices higher.

Nvidia (NVDA, Financial) has announced that its custom processor will power the newly unveiled Nintendo Switch 2, which promises enhanced gaming experiences with up to 4K resolution and 120 FPS at 1080p. The console, featuring AI-driven enhancements and improved graphics, is set to launch in the U.S. on June 5. Nvidia's involvement highlights the company's continued innovation in gaming technology.

The apparel sector is facing significant challenges as new tariffs on Southeast Asian imports, ranging from 30% to 49%, threaten to increase costs for U.S. companies. These tariffs come as many companies had previously shifted production to these regions to avoid higher costs from China. The increased tariffs may force companies to pass on costs to consumers, potentially impacting demand.

HP (HPQ, Financial) and Dell Technologies (DELL, Financial) have been hit hard by the tariff announcements, with shares falling 13% and nearly 15%, respectively. The hardware sector is under pressure due to policy uncertainty and a slowdown in enterprise spending, compounded by the tariffs on diversified manufacturing away from China.

The leveraged ETF market faced a downturn as these funds, which amplify returns through leverage, struggled amid heightened volatility. The selloff in major indices has further exacerbated losses for these ETFs, intensifying negative momentum in the trading environment.

The Magnificent Seven stocks, including Apple (AAPL, Financial), Amazon (AMZN, Financial), and Microsoft (MSFT, Financial), are closely tied to the fluctuations of the U.S. dollar and Euro. A potential relief rally in these stocks could lead to a similar rally in the U.S. dollar, impacting gold prices, which have seen a year-to-date increase.

Intel (INTC, Financial) and Taiwan Semiconductor Manufacturing (TSM, Financial) are reportedly in talks for a joint venture involving Intel's foundry facilities. This collaboration could leverage TSMC's expertise in chipmaking, although no final agreement has been reached yet.

RH (RH, Financial) experienced a significant drop in stock value due to disappointing earnings and exposure to import tariffs from Southeast Asian suppliers. The company faces challenges from inventory sourcing and potential demand destruction, impacting its revenue and EBITDA guidance.

The French aerospace sector, led by Airbus (EADSF), has urged the European Commission to respond to U.S. tariffs that threaten their export industry. The sector seeks carefully designed counteractions to minimize unintended consequences for European firms reliant on U.S. imports.

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