| U.S. stocks started the trading week on a strong note, with the S&P 500 (SPX) surging nearly 100 points and reclaiming its position above the 200-day moving average resistance level of 5,750. The Nasdaq Composite also saw a notable gain of over 2.25%, driven by a rally in tech stocks after President Trump adopted a more cautious stance on tariffs against U.S. trading partners ahead of the April 2nd “reciprocal tariff” deadline announced weeks ago. Overnight, U.S. stock markets received a boost following reports from both the WSJ and Bloomberg that Trump’s planned announcement of universal, reciprocal trade tariffs on April 2 would be more targeted and less broad than initially expected. Later in the afternoon, President Trump confirmed this, stating that tariffs on autos, aluminum, and pharmaceuticals would be implemented in the “very near future.” His comments pushed the U.S. dollar and Treasury yields higher, while Bitcoin rose and gold declined. The market’s strength was widespread, with all eleven S&P sectors in positive territory. Technology (XLK) led the way with a 1.8% gain, while Consumer Discretionary (XLY) surged 3.75%, making it the top-performing sector. Financials, Materials, Industrials, and Energy also posted gains exceeding 1%. On the economic front, the S&P Global March flash composite PMI came in at 53.5, up from 51.6 in February. The services PMI jumped to 54.3 (vs. 51.0 in February), while the manufacturing PMI fell to 49.8 from 52.7 the previous month. Meanwhile, the CBOE Volatility Index (VIX) dropped over 9% to 17.50 after breaking back below 20 last Friday. Key market focus this week will be on tariff developments, inflation data (PCE), and the upcoming GDP report. In corporate news, Tesla (TSLA) surged as much as 11.9% after enduring a nine-week losing streak, helping to drive the Nasdaq higher alongside other “Magnificent 7” stocks and semiconductor companies (SOX). Defensive sectors like utilities and consumer staples lagged behind. Looking at historical context, Bespoke Invest highlighted that exactly 25 years ago, after a 14.6% rally in the previous month, the S&P 500 reached its Dot-Com Bubble peak. Over the next year, the index would go on to decline by 25%, ultimately plunging 49% by its October 2022 low. |