The Market Brief
Hey team. Wall St futures were muted during early trading after President Trump has announced a 25% tariff on all cars not made in the US.
Let’s re-cap the previous session and see what’s next!
Impact Snapshot
🟥 Unemployment Claims - 8:30am
🟥 Q4 GDP - 8:30am
Macro Viewpoint
After a brief period of gains, concerns over tariffs and broader economic conditions led to a decline in U.S. stock markets yesterday.
The S&P 500 and Nasdaq ended their longest winning streak in over a month during the previous session, as investors turned cautious ahead of an anticipated auto tariff announcement.
President Trump has issued an executive order imposing a 25% tariff on automobiles and certain auto parts. The tariff on vehicles is set to take effect on April 3, while specific auto parts will be subject to tariffs no later than May 3.
Countdown to reciprocal US tariffs
Amid another eventful week for US trade policy, all eyes remain focused on the reciprocal tariff announcement President Trump plans to make on April 2, and it’s believed the risks lean toward an initial announcement that negatively surprises markets.
Specifically, GS expects the initially proposed tariff rate to be higher than the 9pp increase, partly because White House officials have said that the soon-to-be announced tariff rates are intended as the basis for negotiation, which incentivizes the Administration to propose higher rates at the outset.
In terms of the timing, the Administration looks likely to use emergency authority to impose the upcoming tariffs, which could lead to implementation within days of the April 2 announcement.
However, there is a good chance that implementation may take longer, as the Administration would likely exercise caution in implementing such high-impact tariffs.
