From Nasdaq: 2025-04-14 11:00:00

Last week, U.S. stocks had a historic rally with the S&P 500 and Dow Jones gaining 5.7% and 5%, respectively, while the Nasdaq rose by 7.3%. The surge was fueled by a pause in reciprocal tariffs announced by President Trump. Tech, industrial, and financial sectors were the biggest winners.

President Trump halted reciprocal tariffs on 75 countries for 90 days, benefiting tech giants. However, tariffs on China were increased to 145%, with China retaliating by raising duties on U.S. imports. Consumer sentiment hit a low in April, with inflation expectations at their highest since 1981.

Inflation slowed in March, showing economic strength, prompting speculation of a more accommodative Fed stance. U.S. stocks are the cheapest in 18 months, with a low forward P/E ratio. However, fluctuating trade policies are clouding earnings outlooks for the rest of the year.

First-quarter earnings for the S&P 500 are expected to grow by 5.8% year over year on 3.8% higher revenues. Volatility is expected to continue, with economic softening and geopolitical risks looming over the bullish case. Investors should brace for potential earnings pressure in the coming weeks.



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