U.S. Indices closed notably in the red on Wednesday as they were hit by risk-off trade due to a combination of factors, namely Trump tariff developments and an FT article overnight that Chinese energy efficiency rules could hit Nvidia (NVDA) sales. As such, Technology was the clear sectorial laggard, with mega-cap names Communication Services and Consumer Discretionary the next worst performers. Overall, sectors were mixed as Consumer Staples, Utilities, Energy, and Real Estate all saw gains (in that order), with the former buoyed by gains in the crude complex. However, WTI and Brent trimmed gains amid the souring of broader risk sentiment which was largely stoked by two remarks: 1) Bloomberg reported that US President Trump prepares auto tariff announcement as soon as today, something later confirmed by the White House, and 2) FT reported that EU Top Trade Negotiator Sefcovic expects US President Trump to hit the bloc with tariffs of about 20% next week. In wake of the latter, we saw Dollar strength pick up and the Euro lag, with equities also selling off to session lows. In FX, both the Japanese Yen and Sterling were weak, with the latter hit in response to UK Chancellor Reeves’s budget and inflation data. Treasuries chopped to strong Durable Goods Orders data and the aforementioned downbeat risk tone. For the record, Fed speakers saw Goolsbee warn that it may take longer than expected for the next cut to come due to economic uncertainty, while Kashkari said they should sit where they are to see how the economy reacts to tariffs. Musalem also said that patience with policy is appropriate. In addition, doubts continue to linger on whether the Russia/Ukraine partial ceasefire will hold, as both sides accused the other side of launching attacks on their facilities, with each side refuting the other’s claims thereafter. Albeit not garnering a market reaction, Atlanta Fed GDPnow (Q1) was unrevised at -1.8% (prev. -1.8%), while “gold adjusted” was revised lower to +0.2% from +0.4% on March 7th. There were several updates on the trade front on Wednesday. Reports overnight noted that US President Trump may implement copper tariffs within weeks, while the White House later announced they will give an update on auto tariffs alongside the closing bell, after Bloomberg reported Trump is preparing an auto tariff announcement as soon as today. Meanwhile, the Wall Street Journal reported that Trump is considering more limited tariff plans and that automotive tariffs could be narrowed and reciprocal tariffs lowered in the latest administration proposals. The WSJ was citing Senator Moreno (Republican) and others familiar with the discussions. The senator said that the White House is mulling plans to impose tariffs on finished vehicles coming into the US but not automotive parts. On reciprocal tariffs, it reported Trump’s team is preparing action by calculating tariff rates for trading partners based on barriers including taxes and regulations, but the administration might not implement the full value of the tariff rate for each country. Also, the FT reported commentary from the EU’s Top Trade Negotiator, who said he expects US President Trump to hit the bloc with tariffs of about 20% next week, and it would apply to all 27 member states, although FT reported that a White House official said no final decisions have been made. Meanwhile, Politico suggested tariff rate slightly differed, with the cited two diplomats postulating the Trump April 2nd tariff rate on the EU to be as high as 20 or 25%. Durable Goods surprised to the upside in February with the headline rising 0.9%, above the -1.0% forecast, adding to the strong rise in January of 3.3%. The Ex-defense metric rose by 0.8%, above the 0.0% forecast, versus the prior 3.7% print. Ex transport rose 0.7%, above the 0.2% forecast, accelerating from the prior 0.1%. The strong data shows that core numbers were strong, with ex-defense and ex-transport both beating expectations. The better-than-forecast data also likely shows that orders are still flowing ahead of the implementation of tariffs. The US Steel and Aluminum tariffs took effect on the 12th March, so it will be interesting to see if there is a reversal next month. Capital Economics highlights that “Stronger orders for primary metals and fabricated metal products in February suggest that tariff effects helped to drive up core Durable Goods Orders last month”. The desk also notes that with underlying capital goods shipments also doing well, machinery and equipment investment is on track to rebound this quarter, albeit not by enough to prevent a sharp slowdown in overall GDP growth. In wake of the data, the Atlanta Fed updated their GDP estimate, which was unchanged at -1.8%, although the gold-adjusted model was updated to show growth at +0.2%, down from the prior 0.4% on March 7th. Fed Member Kashkari said a lot of progress can be made on bringing inflation down, but there is still more work to do. Kashkari added that in the next year or two, the Fed ought to be able to reduce interest rates further. Note, on 7th Feb he said, barring something really surprising on admin policy, he expects the policy rate to be modestly lower at year-end vs now. On confidence, noted this is the most dramatic shift in confidence in last decade, save for COVID era. Kashkari added that it is conceivable that the hit to confidence could be a bigger effect than the tariffs themselves, and he takes very seriously the hit to confidence; the longer it lasts, the more meaningful it is. He concluded kind of wash between the forces on interest rates from tariffs, so we should sit where we are. Meanwhile, Fed Member Goolsbee via FT, said it may take longer than anticipated for the next cut to come because of economic uncertainty. He echoed other officials that a ‘Wait and See’ approach is the correct approach when facing uncertainty. He reiterated that he believes borrowing costs will be a fair bit lower in 12–18 months. The Chicago Fed President added that if investor expectations begin to converge with those of American households, the Fed would need to act. He also noted that market angst over inflation would be a red flag. Elsewhere, both Oil and Gold closed flat on Wednesday.
To mark my 3150th issue of TraderNoble Daily Commentary I am offering a special 2-Year Rate of Euro 2750 for my Platinum Service which includes 1 to 4 updated emails throughout the trading day to demonstrate this value, a monthly subscription over the same period would cost 4440 euro in total This offer represents a 38% discount and is open to both new and existing members. If anyone is interested in this offer can you please email me on bryan@tradernoble.com for details
For anyone following my Platinum Service it made 110 points yesterday and is now ahead by 2834 points for March after closing February with a gain of 4180 points. January ended with a gain of 2768 points while 1997 points were gained in December. October ended with a gain of 2179 points, after closing September with a gain of 4402 points, following a loss of 301 points in August. July gained 1908 points while June saw a gain of 2074 points. The Platinum Service made a record 9619 points in October 2022. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 1900 points. I have a YouTube Channel which contains recent interviews I have given This can be viewed by clicking HERE Please subscribe to this for new interview notification
Equities
The S&P 500 closed 1.12% lower at a price of 5712.
The Dow Jones Industrial Average closed 132 points lower for a 1.32% loss at a price of 42,454.
The NASDAQ 100 closed 0.83% lower at a price of 19,916.
The Stoxx Europe 600 Index closed 0.70% lower.
Yesterday, the MSCI Asia Pacific closed 0.5% higher.
Yesterday, the Nikkei closed 0.65% higher at a price of 38,027.
Currencies
The Bloomberg Dollar Spot Index closed 0.46% higher.
The Euro closed 0.3% lower at $1.0748.
The British Pound closed 0.4% lower at 1.2874.
The Japanese Yen fell 0.2% closing at $150.30.
Bonds
Germany’s 10-year yield closed 2 basis points lower at 2.78%.
Britain’s 10-year yield closed 3 basis points lower at 4.73%.
U.S.10 Year Treasury closed 5 basis points higher at 4.35%.
Commodities
West Texas Intermediate crude closed 0.1% higher at $69.69 a barrel.
Gold closed unchanged at $3019.10 an ounce.
This morning on the Economic Front we Euro-Zone Money Supply at 9.00 am. This is followed at 12.30 pm by U.S. Trade Balance, Weekly Jobless Claims and Wholesale Inventories. Next, we have Pending Home Sales at 2.00 pm. Finally, we have the Kansas City Fed Manufacturing Index at 3.00 pm and a Seven-Year Treasury Auction at 5.00 pm.
Cash S&P 500
For the first couple hours of the American trading session, it was another relatively calm day in the market as the major U.S. indexes were mixed, with the Dow Jones Industrial Average up slightly and the others down slightly. Even the equal-weighted S&P 500 was up – at one point, 360 of the index’s 500 stocks were showing gains for the day – and volatility was subdued again. But by the afternoon, things changed. For one thing, news broke that a Trump announcement on automobile tariffs would be coming later from the White House. For another, a widely followed Federal Reserve Bank of Atlanta GDPNow model update showed an estimated real GDP declining 1.8% for the first quarter. That is recessionary, and these kinds of readings almost always lead to market volatility. After lunch, all the major U.S. indexes were lower, with the tech-heavy Nasdaq Composite Index off almost 2%. The CBOE Volatility Index (“VIX”) ticked up by 10% to an intraday high around 19, and the only sectors that were gaining were defensives like consumer staples, utilities, and energy. Clearly, Mr. Market has not completely moved past tariff talk or the general jittery environment of the past few months… And enough investors and traders are still grappling with mixed messaging and concerns about the economy moving ahead. For example, in an interview late Tuesday with Newsmax, Trump said of his “reciprocal tariff” plans for April 2, “I’ll probably be more lenient than reciprocal, because if I was reciprocal, that would be very tough for people.” But less than 24 hours later, the attention was back on new tariffs on automakers, which had been given a one-month reprieve from a separate round of import taxes earlier this month. It may be difficult to keep it all straight. On Wall Street, the easiest approach is to sell first and ask questions later. The recent stock market correction, with the S&P 500 falling 10%, has not scared away the herd of mom-and-pop retail investors. According to trading-activity firm VandaTrack, individual investors have plowed $67 billion into stocks so far in 2025. Which is only slightly below the $71 billion in inflows from the fourth quarter of 2024 – when the S&P 500 gained about 2% and the Nasdaq rose by about 5%. In contrast, the most recent Bank of America Global Fund Manager Survey for the month showed the biggest rush to cash since the March 2020 bear market. And in terms of U.S. stocks, the survey has never seen such a large exit from stocks. From that March 18 Digest…’This month also saw the largest outflows from U.S. stocks in the history of the survey. Fund managers reduced their U.S. equity exposure by 40 percentage points, making their total allocation to U.S. stocks 23% underweight’. So professional money managers are limiting their exposure to stocks and holding the most cash they have in five years. Yet at the same time, retail investors are more than happy to take on the risk, especially in the Magnificent Seven stocks. Wednesday’s late sell-off saw the S&P trade the whole of my buy range for a now 5734 average long position. I will leave my 5699 ‘Closing Price’ stop unchanged, while lowering my T/P level to 5745. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
EUR/USD
After the close the Euro sold off to my 1.0740 buy level. I am still long, and I will continue to look to add to this position on any further move lower to 1.0660 while leaving my 1.0595 ‘Closing Stop’ unchanged. I will now lower my T/P level to 1.0800. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Dollar Index
I am still flat the Dollar as the market again fell shy of Wednesday’s buy range before rallying into the New York close. Today, I will continue to be a small buyer on any dip lower to 103.10/103.90 with the same 102.60 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 104.40.
Russell 2000
After the close last night the Russell traded lower to my 2065 buy level. I am still long with a now lower 2105 T/P level. I will add to this position on any further move lower to 2005 with a now higher 1945 ‘Closing Stop’. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
Cash FTSE
The boring sideways trading in the FTSE shows no sign of ending anytime soon despite the worsening economic and political situation in the U.K. I am still flat the FTSE market as I continue to look to buy the market on any dip lower 8530/8600 with the same 8465 ‘’Closing Stop’’. If I am taken long, I will have a T/P level at 8655. Despite the higher Gilt Yields I still do not want to be short the FTSE at this time.
Dow Rolling Contract
After the close the Dow traded lower to my buy range for a 42270 long position. As I am now long the S&P, NDX and Russell, I have now exited this long position here at 42380 as I want to bank some points for Wednesday’s commentary, and I am now flat. The Dow has further support below from 41880/42140 where I will again be a buyer with a lower 41695 ‘Closing Stop’’. If I am taken long, I will have a T/P level at 42380.
Cash NASDAQ 100
The NDX got hit hard yesterday, leading the American Indexes lower into the close. This sell-off saw the whole of Wednesday’s buy range triggered for a now 20030 average long position. I will leave my 19815 tight ‘Closing Stop’ unchanged while lowering my T/P level to 20150. If any of the above levels are hit, I will be back with a new update for my Platinum Members.
December BUND
The Bund just missed Wednesday’s buy range before having a small rally into the close. I will not chase the Bund higher as I continue to be a buyer on any dip lower to 127.40/128.20 with the same 126.75 ‘’Closing Stop’’. If triggered, I will have a T/P level at 128.90. I still do not want to be short the Bund at this time. If this view changes, I will be back with a new update for my Platinum Members.
Gold Rolling Contract
No Change: Gold again traded in a narrow range without ever threatening yesterday’s sell range. Today, I will continue to be a seller on any further rally to 3070/3088 with the same 3111 ‘’Closing Stop’’. I still do not want to be long Gold at this time. If I am taken short, I will have a T/P level at 3053.
Silver Rolling Contract
I am still flat as despite the volatility in equity markets, Silver traded in a narrow range. Today, Silver has support below from 32.40/33.10 where I will again be a buyer with the same 30.95 ‘Closing Stop’. If I am taken long, I will have a T/P level at 33.85.
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