The opinions expressed below are my own and do not necessarily represent those of Visdom Investment Group, LLC.
Tariff pause?
Futures were +30 overnight and fell to flat come market open. Feb ADP (+77k vs +140k est & +186k prior revise from +183k) was soft and renewed concerns of a slowdown. We traded flatish until 11 AM. The index dipped for an hour and recovered quickly just before noon. We climbed from then on, stabilized around +65 points in the late afternoon, and finished the day without a selloff. Trump promised automakers covered by the USMCA that tariffs would be paused for them for a month. The market is re-embracing the proposition that the tariffs are more bark than bite. Capital flow remains elevated at 112% and tech led the market higher with the Mag 7 attracting the dip-buyers.
We are in a ping pong market. Tariffs happening, tariffs not happening. Not helping Ukraine, helping Ukraine. Left hand does something, right hand undoes something. It’s quite a circumstance. It’s unclear if all these about faces are legitimate or if they are theater. Investors are left to guess but as a trend shows up, investors hop on the trend and trust in the judgement of the market.
That is dangerous. The momentum game often reveals more about the size of the momentum crowd than the actual lay of the land. As always, we wait and see for what the heck is actually going to happen. At the moment, the market believes whatever the latest White House soundbite as fact but it is ready to go the other way in a heartbeat.
That’s going to leave a mark for sure.
See you tomorrow.
-Mike
IMPORTANT INFORMATION
This is general educational information and market commentary and is intended for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of any financial instrument or as an official confirmation of any transaction.
All market and economic data herein is as of the date hereof and sourced from Bloomberg unless otherwise stated. The information is subject to change without notice and we have no obligation to update you.
This general market commentary is intended for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of any financial instrument or as an official confirmation of any transaction. The views and opinions expressed constitute the author(s) judgment based on current market conditions, are subject to change without notice, and may differ from those expressed by other employees of Visdom Investment Group LLC ("Visdom") and Visdom. Past performance and any forward-looking statements are not guarantees of future results. It is not possible to invest directly in an index.
We believe the information contained in this material to be reliable and have sought to take reasonable care in its preparation; however, we do not represent or warrant its accuracy, reliability or completeness, or accept any liability for any loss or damage (whether direct or indirect) arising out of the use of all or any part of this material. Any securities referenced are shown for illustrative purposes only, and are not intended as a recommendation or endorsement by Visdom or by the author(s) in this context. The information presented is not intended to be making value judgments on the preferred outcome of any government decision. This information does not constitute Visdom research, nor should it be considered a recommendation of a particular investment strategy or an offer or solicitation for the purchase or sale of any financial instrument. Investing involves market risk, including the possible loss of principal. You should speak to your financial advisor before making any investment decisions. Visdom and its affiliates do not provide legal, tax or account advice so you should seek professional guidance if you have questions.
