Summary

Taming tariffs drive stock recycling Stock markets have been volatile to a large extent in April. In a series of economic and geopolitical cross-flows, the driving force has been tariffs, and even more so. The early part of the month was characterized by a sharp abandonment, reminiscent of the market crash of the 2008 recession or a slump in the fear of the 2020 Covid-19 shutdown. However, as the Trump administration's adjustment to tariffs has eased the tariff adjustments, the stock market will be grand. Stocks are still far from the level of opening up at the beginning of the year, and have not even established a new all-time high. However, the recovery has scared the market. Now, the sales day we're seeing won't turn into a rout like it did in early April. As of the market closures as of April 25, 25, the S&P 500 (5,525) has dropped 6.1% so far; it has also dropped 1.5% in April to date. Nasdaq shares fell 10.0%, while the Dow Jones industrial average fell 5.7%. At the closing low on 4/8/25, above the tariff panic, the S&P 500 fell 15.3%, down 15.3% so far, up 6147 from its all-time high in February 2025. In addition to tariff implementation and ongoing negotiations with many countries, the stock market is focused on the president's reversal regarding the Fed's chairman. President Trump called Jerome Powell a "main loser" and said the central bank made a mistake not to lower interest rates immediately, saying he "unintentionally" sought to fire the Fed chairman. Investors believe Treasury Secretary Scott Bessent and other government officials convinced the president to invoke a rapid deterioration in the treasury market and the dollar to retreat. However, investors did not celebrate the stock's comeback. The Bravado market in 2024 seems to have completely disappeared. Now, institutional investors who tend to buy every sale within the 2023-24 period now seem to have triggered preparations for every gathering. Currently, key tariff negotiations are underway with Japan, India and other countries. In many cases, any negotiation with China is at a minimum or non-existent level. The results of the Canadian election show the anti-American tone of our northern neighbors. This type of event, or wandering from the president’s social truth, could regress the market to lows. Industry in Q2: Assuming growth returns from rally held since mid-April, the market leadership position in 2q25 is very different from that in Q1. In the first quarter, the best performing sector was defensive, rate-sensitive and/or provided inflation protection. The winning sectors in the first quarter include energy, utilities, consumer staple food, health care and materials. The worst first quarter sectors are information technology, consumer discretion and communication services. These three departments led the market in 2023 and 2024. They also tend to provide the best growth prospects, which are obviously attractive to investor weakness. The best performing departments in 2q25 to date are utility and information technology. Consumer discretion and consumer staple foods are also positive in terms of scores. As of late April, no other department was active. The first quarter champion Energy (Energy) harvested 8% in the first quarter of 1q and fell nearly 11% in the second quarter of 2Q as energy prices continued to decline. Healthcare also gave first-quarter earnings, down about 4% in the second quarter as of late April, with leading health insurers being overwhelmed. The weaknesses of the growth sector in Q1 and the defensiveness of the 2q25 in Q1, rate-sensitive, cyclical and inflation-protecting sectors resulted in positive trading year ending in 2025: Utilities (up nearly 4%), Consumer Staples (up 2.5%), Healthcare (up 2.5%), 0.75% and Real Estate (up 0.75%) and 0.5555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555555 The rest of the departments have been negative so far. Thanks to the April rebound, information technology is no longer the worst area of ​​2025. This difference is at the discretion of the consumer. As appropriate, the start of 2024 was also poor, and was deeply behind the broad market in the first and second quarters. Last year, it bounced higher in the third and fourth quarters of last year, hoping the Fed’s newly launched tax-cutting campaign will reduce financing costs and stimulate large purchases. The industry has weakened this year due to concerns that tariffs will lead to large fare costs and prices. Expensive items such as vehicles, houses and appliances are often built through highly complex supply chains to purchase parts and components from around the world. When the tariff environment changes every day, it is impossible to predict the final cost and price of such projects. If half of these 11 sectors will enter a positive field, this will be very positive for a broad market reversal. Revenue updates have meaningfully improved the 1Q Earnings Scorecard over the past week. Factset, Refinitiv and Bloomberg's hybrid EPS growth estimates are all 300 to 400 basis points higher than at the end of the first week of Q1 earnings, as the upside space replaces conservative estimates in hybrid TALLE. Due to the reported FACTSET estimates, during continued operations in Q1, FACTSET estimates that FACTSET estimates that the combined growth rate of COMP S&P 500 revenues in 500 years is 10.1%. This was 7% a week ago, when only 12% of companies reported results for 1q. The patchwork plant estimates an estimated earnings per share increase of 10.9% on a mixed basis, compared with 10% on Bloomberg. Both are in the range of 7%-8% a week ago. To date, about 73% of companies have exceeded street expectations. A week ago, the percentage was close to 70%. Long-term (last 10 years), about three-quarters of companies that report EPS growth are surprised by this. In addition, the amplitude of EPS increased from 6% (12% of reported companies) to 10% (36% of reported companies). This is better than the long-term average of 7%, and now it is better than the intermediate average of 9%. Several large and well-known communications services make up companies – Letters, Netflix and Comcast – brought strong upward EPS surprises and were responsible for most of the cumulative increase. Six or seven sectors reported positive earnings per share growth, with four to five sectors falling year-on-year. (Using different agencies with slightly different metrics, explaining the differences in revenue magnitude.) All the agencies that compiled income agreed that energy has performed the worst EPS so far, with the worst EPS so far, with energy dropping in seniors. Hope Energy W