US Indices closed positive on Tuesday, grinded higher for large parts of the US session as both Treasury Secretary Bessent and Commerce Secretary Lutnick spoke, albeit indices saw a bout of pressure on the former, but strength on the latter. The appearances come ahead of President Trump speaking this evening in Michigan where he is expected to announce auto tariff relief. On trade deals, Lutnick said one trade deal is reached with a country he does not name, whereby FBN’s Gasparino later suggested, citing word on Wall St, it is either India or South Korea. Elsewhere, regarding US data, JOLTS printed below the bottom end of analyst estimates, while consumer confidence also disappointed and tumbled beneath expectations with responses detailing tariff concerns. The advanced goods trade balance widened in March, despite expectations for a slight pull back. In wake of the data, the Atlanta Fed GDPNow model was updated for the last time before the official Q1 report to be released on Wednesday. It now tracks growth at -2.7% but -1.5% on a gold adjusted basis, versus the consensus for the Q1 print of +0.3%. Sectors were almost exclusively in the green, aside from Energy, which was weighed on by weakness in the crude complex. There was a deluge of earnings, with highlights including UPS, SPOT, RCL, KO, PYPL. The Dollar Index was firmer against all G10 peers, while the Canadian Dollar (flat) was the relative outperformer. T-Notes rose across the curve after the aforementioned job openings declined, consumer confidence fell, and trade deficit rose, increasing growth concerns. Ahead, the week is littered with scheduled risk events with PCE, GDP, NFP, ISM Manufacturing on the data docket and earnings from the likes of META, AAPL, MSFT, AMZN. Also, US President Trump is due to speak in Michigan overnight and confirm the auto tariff relief measures. The March JOLTS saw Job Openings fall to 7.192 million from 7.568 million, beneath the analyst consensus of 7.48 million. Meanwhile, the number of hires was little changed at 5.4 million, and was little changed in all industries. The quits rate rose to 2.1% from 2.0%, while the vacancy rate eased to 4.3% from 4.5%. Oxford Economics highlight the report showed some cooling of labour market conditions, but it is not enough to bring forward Fed rate cut expectations as the Fed will be monitoring the tariff impact on inflation. Oxford Economics continue to expect the first Fed rate cut to occur in December, which is more hawkish when compared to market pricing that has the first 25bps rate cut fully priced by July, with a 72% probability of a 25bps rate cut in June. The US goods trade deficit reached a record size in March at USD 162bln, up from February’s 148bln, despite expectations for this to dial back to USD 145bln. Analysts have warned that the surge in the deficit will likely put pressure on the Q1 GDP numbers. In wake of the data, the Atlanta Fed GDPNow model was updated for the last time before the official Q1 report to be released on Wednesday. It now tracks growth at -2.7% but -1.5% on a gold-adjusted basis, versus the consensus for the Q1 print of 0.3%. The widening trade deficit in goods saw imports surge by USD 16.3bln to USD 342.7bln, primarily driven by consumer goods and capital goods, while exports only rose by USD 2.2bln, to USD 180.8bln. Within the report, Wholesale Inventories rose by 0.5%, matching the last month’s print, which was revised up from 0.3%. Retail inventories (ex-auto) rose by 0.4%, above the 0.1% prior. Pantheon Macroeconomics summarises that “The picture for Q1 overall remains that President Trump’s tariff threats set off a rush to buy goods now rather than face higher prices later, prompting a startling surge in imports that has left previous blowouts in the trade deficit looking trivial.” Consumer confidence fell to 86.0 from 92.9 and beneath the expected 87.5. The Present Situation Index decreased 0.9 points to 133.5, while Expectations Index tumbled 12.5 points to 54.4, the lowest level since October 2011. The headline fall was broad-based across all age groups, most income groups, and across all political affiliations. Within the report, average 12-month inflation expectations reached 7% in April, the highest since November 2022. The report adds that write-in responses on what topics are affecting views of the economy revealed that tariffs are now on top of consumers’ minds, with mentions of tariffs reaching an all-time high. Additionally, present situation consumers’ assessments of current business conditions were more positive in April, but consumers’ views of the labour market weakened. Expectations six months hence consumers’ outlook for business conditions fell further, and consumers’ outlook for the labour market outlook also worsened. Overall, consumer confidence declined for a fifth consecutive month, falling to levels not seen since the onset of the COVID pandemic, Stephanie Guichard, Senior Economist at The Conference Board stated. Adding, “The decline was largely driven by consumers’ expectations. The three expectation components, business conditions, employment prospects, and future income, all deteriorated sharply, reflecting pervasive pessimism about the future.” Furthermore, Guichard noted, “expectations about future income prospects turned clearly negative for the first time in five years, suggesting that concerns about the economy have now spread to consumers worrying about their own personal situations. However, consumers’ views of the present have held up, containing the overall decline in the Index.”
To mark my 3175th 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 lost 115 points and is now ahead by 7325 points for April after closing March with a gain of 2254 points while 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
Recent Comments