April 9, 2025

Markets: 

U.S. stock futures are under pressure again this morning after China announced fresh retaliatory tariffs on American goods — the latest escalation in an already tense global trade environment. Starting Thursday, China will impose an 84% tariff on U.S. goods. This follows the U.S. rolling out 104% tariffs on Chinese imports just after midnight. The situation intensified further when Scott Bessent commented that the Chinese government doesn’t “want to come and negotiate,” sending futures even lower. Meanwhile, U.S. tariffs on other global partners have also kicked in. Canada reaffirmed plans to implement 25% retaliatory tariffs on U.S.-made vehicles, including those that don’t meet the content rules of the USMCA, and even certain vehicles that do — if the non-Canadian/Mexican content is too high. Markets have been rattled. Tuesday was a rollercoaster: the S&P 500 surged over 4% intraday before closing down 1.6%, while the Dow jumped as much as 3.9% but still ended the day down 0.8%. The S&P is now nearly 19% off its highs, adding to a four-day losing streak fueled by tariff anxiety and policy uncertainty.

Portfolio: 

We head into today’s session holding one setup in FAZ.  This morning's premarket action has us wondering: Is the market trying to form a bottom? SPY and QQQ are in the red but still holding this week’s key lows — 402 for SPY, 482 for QQQ. These are your lines in the sand. A break below could invite more downside pressure, with SPY at risk of closing under 490 — officially entering bear market territory. Below 482, SPY support zones line up at 478 and 466. For QQQ, watch 400 as key support, with 394 and 382 below that. There’s also an open gap down to 378. That said — keep an open mind. Futures were aggressively green at one point overnight, so don't rule out the possibility of a sharp reversal or bounce attempt.

Now, remember QE? A notable headline this morning from Deutsche Bank: “If recent disruption in the US Treasury market continues, we see no other option for the Fed but to step in with emergency purchases of US Treasuries to stabilize the bond market (‘emergency QE’).” If this happens, the market could rip to new highs. We’ve seen this playbook before. It aligns with what many believe President Trump may be pushing for — lower rates and a reset from the Fed to support his economic vision of expansion. It’s early, and yes, we could still go lower. But we must begin preparing for the possibility of a significant injection of liquidity into this market. Be ready today