Through the Fog of Uncertainty: U.S. Markets at the Start of April
Market News 02 APR
U.S. equity markets ended Tuesday, April 1, with mixed results, as investors navigated a turbulent landscape shaped by economic warnings and looming political risks. Despite early losses, a late-session rebound led by Big Tech helped indices recover some ground.
S&P 500 closed up +0.38%
Nasdaq 100 gained +0.82%
Dow Jones dipped -0.03%
Futures on major indices also ended higher, signaling that risk appetite remains intact — for now — even as the macro backdrop becomes increasingly fragile.
Big Tech: The Market's Lifeline
Once again, the market leaned heavily on its strongest pillars — the so-called “Magnificent Seven”: Microsoft, Apple, NVIDIA, Meta, Alphabet, Amazon, and Tesla. Together, they form the core of U.S. market resilience, representing nearly 20% of the S&P 500’s total market cap.
Microsoft surged +1.8%
NVIDIA rose +1.6%
Apple edged up +0.5%
Tesla climbed over +3% following a positive inclusion in Wells Fargo's tactical picks
Lucid Group also stood out with a 7.5% gain, reportedly benefiting from an influx of former Tesla customers, while CoreWeave, backed by Nvidia, skyrocketed over +40% after its IPO, attracting investor attention despite recent losses.
Stagflation Fears on the Rise
Behind the surface optimism lies an increasingly alarming economic narrative:
The ISM Manufacturing Index fell to 49.0%, signaling contraction in industrial activity.
The Prices Paid Index within ISM jumped to 69.4, its highest level in nearly three years — hinting at surging input costs.
Job openings (JOLTS) dropped to 7.568 million, below expectations, indicating a cooling labor market.
This combination — falling activity, rising prices, and weakening employment — raises red flags for stagflation, one of the toughest scenarios for central banks to navigate.
Trump’s Tariff Threat Looms Large
Another major source of anxiety is the anticipated announcement of new U.S. tariffs. According to The Washington Post, the Biden administration — in alignment with Trump's policy direction — is set to announce duties of up to 20% on a wide range of imported goods.
Recently signed executive orders include:
A 25% tariff on foreign-assembled vehicles (effective April 3)
Upcoming duties on auto parts (beginning in May)
Doubling tariffs on Chinese goods from 10% to 20%
Markets responded defensively: Treasury yields dropped and gold surged to new all-time highs as investors sought safe havens ahead of rising global trade tensions.
Winners and Losers
Top performers:
Lucid Group: +7.5% — as EV demand shifts from Tesla and domestic production ramps up
CoreWeave: +40% — buoyed by its Nvidia partnership and rising demand for AI infrastructure
Shake Shack, Ulta Beauty, and Keurig Dr Pepper — gained after bullish analyst upgrades
Notable decliners:
Johnson & Johnson: -7% — after a court rejected its bankruptcy shield strategy for talc-related lawsuits
Moderna, Pfizer, Biogen, Merck: -2% to -4% — hit by political shakeups and regulatory uncertainty in the healthcare sector
Intel, ON Semiconductor, GlobalFoundries: -2% and lower — as chipmakers face rising global competition and margin pressure
Southwest Airlines: -6% — after Jefferies downgraded the stock to “Underperform”
Key Events This Week: Markets Face a Reality Test
Markets are now bracing for a critical round of data and statements that may set the tone for April:
Wednesday: ADP Employment Report (expected +120K new jobs)
Thursday: ISM Services Index (expected to dip to 53.0)
Friday: U.S. Non-Farm Payrolls (forecast: +138K)
Unemployment rate (expected unchanged at 4.1%)
Jerome Powell speaks at a business conference — investors will scrutinize his tone on interest rates and inflation
Wage growth data will also be crucial, with estimates of +0.3% MoM and +4.0% YoY, in line with February.
While the equity market shows resilience, primarily driven by mega-cap tech stocks, the underlying risks are mounting. From stagflation concerns and deteriorating macro indicators to renewed trade tensions and regulatory headwinds — the environment is increasingly fragile.