Stocks Closed Mostly Higher Yesterday, Big Three Indexes Up 3 Days In A Row Stocks closed mostly higher yesterday. This marks 3 up days in a row for the big three indexes (Dow, S&P 500 and Nasdaq). They still have lots of ground to make up. But they have rebounded nicely so far from their worst levels 2 weeks ago. You'll remember that all of the major indexes had fallen into pullback/correction territory with the Dow down -9.33%, the S&P 500 down -10.1%, the Nasdaq down -14.2%, the small-cap index down -18.4%, and the mid-cap index down -15.7%. While stocks are still down from their recent all-time highs, they have cut their losses quite a bit with the Dow now down just -5.39%, the S&P 500 down -5.98%, the Nasdaq down -9.43%, the small-cap index down -14.2%, and the mid-cap index down -11.2%. Eight more days until April 2nd , when we are supposed to get a better idea of what the reciprocal tariffs should look like. But the market has come to believe that there will likely be more delays. And, that the tariffs might ultimately be far less severe than previously feared. President Trump has hinted at that. And U.S. Treasury Secretary Scott Bessent pretty much said that last week when he remarked, "I am optimistic that on April 2, some of the tariffs may not go on because a deal is pre-negotiated, or once countries receive their reciprocal tariff number, right after that, they will come to us and want to negotiate it down." Other countries have taken note of this. The EU, for example, said they will delay imposing their first round of retaliatory tariffs against the U.S. until mid-April, rather than April 2. No doubt, waiting to see what the U.S. does, given their previous delays, and the negotiations taking place. As I mentioned before, it's become clear that the tariffs don't appear to be the endgame, but instead a means to an end, which ultimately is fair trade (and freer trade). Although, some tariffs are meant to be punitive, such as the ones the President is ready to levy on Venezuelan energy. The administration wants to place an additional 25% tariff on imports from any country that purchases oil or gasoline from Venezuela. The White House is calling it a 'secondary tariff.' And it's clearly meant to deter other countries from doing business with Venezuela's President Maduro. As April 2 approaches, others in the business community are beginning to downplay the impact that some have attached to the impending tariffs. Former Target and Toys "R" Us executive said, "I think this whole thing with the tariffs is grossly exaggerated by a factor of at least two." Prices are "not going to go up 10 to 15 or 20%." "I think people are hysterical. It's not nearly the magnitude of what they're talking about." We shall see. But so far, the market seems to believe it's not going to be nearly as bad as some had initially thought. Today we'll get GDPNow's Q1'25 GDP update. You'll remember, the sudden downshift from their estimate of 2.3% to -1.8%, roiled the market with calls for a recession. The last two updates have been revised higher. Well see if that recent trend continues. Regardless, the Fed seemed to tamp those concerns down when they forecast full-year 2025 GDP at 1.7%, with 2026 at 1.8%, at last week's FOMC Announcement, effectively dispelling worries over a recession. Today we'll see if the market can keep their winning streak alive for another day. And hopefully for another week. See you tomorrow,  Kevin Matras
Executive Vice President, Zacks Investment Research | 
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