Weekly Market Update

Weekly Market Update for the Grand Protector

Market Update: Tariffs Cause Turmoil in US Stock Market

The past week has been marked by significant volatility in the US stock market, with stocks plummeting after President Trump's surprise announcement of sweeping tariffs on US trading partners. The Dow Jones Industrial Average (DJIA) and S&P 500 (^GSPC) saw their worst one-day sell-offs since 2020, with the DJIA tumbling almost 1,700 points and the S&P 500 sinking nearly 5%.

The tech-heavy Nasdaq Composite (^IXIC) led the sell-off, plummeting over 6%. Apple (AAPL), Nvidia (NVDA), and other megacap stocks were clobbered, with investors concerned about disruption to their supply chains. The so-called Magnificent Seven stocks that led the market rally over the past two years shed over $900 billion in market cap.

The US dollar index (DX-Y.NYB) tumbled 1.5% to its lowest level since October 2024, while the 10-year Treasury yield (^TNX) fell about 14 basis points to close at 4.05%, its lowest level since October 2024.

Wall Street strategists are now revising their year-end targets for the S&P 500 lower, with some projecting a bear market scenario where the index could end up as low as 4,600. The recent move in markets has pushed some strategists to become less confident in stocks' ability to rebound from the recent crash.

The trade war uncertainty is expected to continue, with China imposing additional tariffs of 34% on all US products from April 10. This has further increased investor worries about a protracted global trade war and its potential impact on the US economy.

Key Takeaways:
• The Dow Jones Industrial Average (DJIA) and S&P 500 (^GSPC) saw their worst one-day sell-offs since 2020.
• The tech-heavy Nasdaq Composite (^IXIC) plummeted over 6%.
• Apple (AAPL), Nvidia (NVDA), and other megacap stocks were clobbered, with investors concerned about disruption to their supply chains.
• Wall Street strategists are revising their year-end targets for the S&P 500 lower, with some projecting a bear market scenario.
• The trade war uncertainty is expected to continue, with China imposing additional tariffs of 34% on all US products from April 10.

Recommendations:
• Investors should exercise caution and reassess their investment portfolios in light of the recent market volatility.
• Those who are more risk-averse may consider reducing their exposure to stocks or investing in other asset classes, such as bonds or precious metals.
• Those who are long-term investors may consider dollar-cost averaging, where they invest a fixed amount of money at regular intervals, regardless of market conditions.