🧠 $3500 iPhones? Trade wars begin with $6T US stock market crash out

🕊️ No paywalled articles.

🏛️ Financial News

• Administration 🏛️ 34% tariff as Trump digs in, vows to 'never change' policies – Yahoo! Finance: US President Trump has played down the shock impact of his tariff shift on markets, which kept spiraling downward to end the week, as fears for the global economy grew.

• Auto Tariffs 🚗 Here are the automobile makes and models that would be the most affected by Trump's tariffs – NBC News: Nearly half of all vehicles sold in the U.S. are assembled abroad, and most have foreign components.

• Federal Reserve 💵 Powell says tariff inflation 'could be more persistent' as Trump urges him to cut rates – Yahoo! Finance: Federal Reserve Chair Jerome Powell appeared to back away from a "base case" view that inflation from President Trump's new tariffs could be transitory, saying that "it is also possible that the effects could be more persistent” as the economy digests "significantly larger-than-expected" trade duties.

• Jobs Report 💼 US labor market shows resilience before trade tensions escalation – Reuters: The US economy added far more jobs than expected in March, but President Donald Trump's sweeping import tariffs could undermine the labor market's resilience in the months ahead amid sagging business confidence and a stock market sell-off.

• Banking 🏦 JPMorgan Says Trump’s Tariffs to Send US Into Recession – Bloomberg via Yahoo! Finance: JPMorgan Chase & Co. said it expects the US economy to fall into a recession this year after accounting for the likely impact of tariffs announced this week by the Trump administration.

• Retail Investors 🙃 Individual investors made a record $4.7B in stock purchases Thursday, as new tariffs pummeled markets – MarketWatch: When the stock market sees red, retail investors see a buying opportunity with a buy-the-dip mentality has gotten stronger since 2022.

  • Video: Does 'buying the dip' work? What history says about buying during a market sell-offs

• 🧠 Upgrade your PortfolioGPT account for an ad-free experience with unlimited portfolio generations!

🌎 US Markets

• S&P 500 📉 US stock market sees biggest 2-day wipeout in history as market loses $11T since Inauguration Day – MarketWatch: According to data from Dow Jones market data, some $6.6T was lost on Thursday and Friday alone – the largest two-day wipeout on record, as the S&P 500 index declined to the lowest level in 11 months.

• Dow Jones 🏭 Industrial index drops 2,200 points, 8% in 2 days as Trump’s tariff rout deepens – MarketWatch: The Dow ended Friday in correction territory, defined as a drop of at least 10% from a recent peak.

• Nasdaq 🌐 Tech megacaps lose $1.8T, as Nasdaq heads toward bear market after worst weekly drop in 5 years – Yahoo! Finance: The tech-heavy composite of so-called Magnificent Seven stocks recorded a 10% drop, its worst week since 2020. Apple led the losses for the group shaving off more than $533B in market capitalization.

• Russell 2000 🏪 Small-cap benchmark becomes first major U.S. stock measure to enter bear market – CNBC: Down more than 20% from the index’s all-time high close in late November 2024.

• Crude Oil 🛢️ Oil dives 6% to lowest in over 3 years, as Trump's tariffs hit China, OPEC output rises – euronews: Crude oil prices plummeted to near multi-year lows following President Trump’s reciprocal tariff announcement, with a larger-than-expected production increase by OPEC and its allies adding further pressure to the sell-off.

• $AAPL 🍏 Wall Street's biggest tech bull warns of $3,500 iPhones as 'economic Armageddon' looms from Trump tariffs – Yahoo! Finance: Wedbush analyst Dan Ives said "50% China tariffs, 32% Taiwan tariffs would essentially cause a shut-off valve from the US tech landscape and in the process cause every electronic to go up 40%-50% for consumers, iPhones made in the US would cost $3,500 (vs. $1,000), and the AI Revolution trade would be significantly slowed down".

• $AMZN 🚗 Amazon could see up to $10B in profits go up in smoke because of Trump tariffs – Yahoo! Finance: Goldman Sachs warned investors that Amazon could see a $5-$10B annualized operating profit hit from higher first-party merchandise costs. Assuming no mitigating factors such as cost cuts or vendor negotiations, analysts estimated that Amazon's US merchandise costs would soar by 15% to 20%.

🌎 North America’s Reaction

• Canada 🍁 Canada says it is 'leading the charge' against Trump's trade war – euronews: As the US trade war unfolds, Canadian Foreign Minister Mélanie Joly said Canada is “leading the charge to put maximum pressure” in response to the Trump administration's sweeping tariffs by imposing counter tariffs.

• Mexico 🥑 Mexico celebrates dodging latest US tariffs but feels the effects of global economic uncertainty – AP News: Mexico celebrated having dodged the latest round of tariffs from the White House taking aim at dozens of US trading partners around the world, but was also quickly reminded that in a global economy the effects of uncertainty can’t be entirely avoided.

🌍 Europe & Middle East Reaction

• Europe Trade 🚗 EU seals new Central Asia partnership deal as debut Samarkand summit ends – euronews: Amid global tensions following Trump's tariff announcements, the European Union has announced a new strategic partnership with countries in Central Asia at the conclusion of a debut summit in the Uzbek city of Samarkand.

• France 🗼 Macron lashes out against Trump's 'brutal' tariffs, calls for a pause in investment – euronews: France president Emmanuel Macron proposed a temporary halt in future European investments in the US, saying the EU 'must not rule out anything' to retaliate against Donald Trump's decision to impose so-called reciprocal tariffs on virtually every country, calling the move "brutal" and "unfounded".

• Israel 🚗 Trump 17% tariffs on Israel a regression in trade relations: Israeli officials, businesses react – Jerusalum Post: Officials said they were convinced that Israel's decision to cancel Israeli tariffs on US imports would prevent US tariffs on Israel.

🌏 Asia’s Reaction

• China 🚗 China hits back at US with 34% tariff on American imports in retaliation for Trump’s levies – South China Morning Post: In the standoff between the world's top two economies, China announced the most serious escalation in a trade war that goes into effect on April 10. Beijing also announced controls on exports of some rare earths, while Trump doubled down as well, vowing not to change course.

• TikTok 🤳 TikTok deal put on hold after China indicated it would reject deal over tariffs, say sources – BBC: A deal to spin off the US assets of TikTok, which was largely finalized, was put on hold after China indicated that it would not approve the deal following President Donald Trump's reciprocal tariffs announcement. The deal structure would have spun off TikTok's US operations into a new company to be owned and operated by a majority of US investors. ByteDance would hold a minority position of under 20%.

• China Reciprocal Tariffs 🚗 Chinese market regulator launches antimonopoly probe into DuPont China – MarketWatch: The antimonopoly probe into DuPont's China operations is the latest in a slew of retaliatory measures from Beijing.

• Vietnam 🚗 Trump says Vietnam willing to cut tariffs on US goods to ‘zero’ to reach deal  – South China Morning Post: The US president says he spoke with Vietnamese leader To Lam, who is seeking to avoid punishing 46% duties.

• India 🚗 India says studying impact of 27% US tariff, vows to push trade deal – Reuters: New Delhi vowed to push for a trade deal this year, signaling a conciliatory tone despite failing to get relief from President Donald Trump's trade policy.

• Japan 🚗 Japan 'disappointed' in Trump tariffs, will support businesses – Reuters: Japanese Prime Minister Shigeru Ishiba gave no indication on possible retaliation but questioned whether the tariffs were consistent with World Trade Organization agreements and whether some of the U.S. calculations about Japan's own tariffs were accurate.

• South Korea 🚗 South Korea's acting president calls for talks with US over 25% tariffs – Reuters: South Korea's acting President Han Duck-soo called for talks with US officials to shield the export-reliant economy from the impact of tariffs and ordered emergency support measures for businesses.

🏖️ Retirement

• Consumer Staples 🛒 20 items and goods most exposed to price shocks from Trump tariffs – CNBC: According to an analysis by the Budget Lab at Yale University, the costs for apparel like clothing and shoes; leather goods like gloves and handbags; and wool and silk products will increase by between 10% and 20%, while the cost of motor vehicles could swell by over 8%.

• Portfolio Strategy 📊 BlackRock CEO says the 60/40 portfolio ‘may no longer fully represent true diversification’ – CNBC: In a new letter to investors, BlackRock CEO Larry Fink writes the “future standard portfolio” may move toward 50/30/20 with stocks, bonds and private assets like real estate, infrastructure and private credit.

• Social Security 🏛️ Changes at SSA may impact customer service, benefit payments – CNBC: Staff cuts and policy changes are going to make Social Security benefits harder to access for many, as new reports that the SSA plans to migrate from an old computer programming language on an accelerated timeline have prompted more concerns about payments.

• Personal Debt 💳 20 items and goods most exposed to price shocks from Trump tariffs – CNBC: According to a new report by the Federal Reserve Bank of New York, more than half of credit card borrowers carry debt from month to month. Credit cards are the No. 1 source of unsecured borrowing, even though interest rates average more than 20%.

• 📧 Subscribe to Great Wealth Xfer Covering the global $84T wealth transfer from Boomers to Millennials and Gen Z. (Coming Soon)

We’ll be back next Saturday morning to recap the week’s financial news.

Thanks to Empower Personal Wealth for sponsoring.

✨ Happy Unprompting,

Rawee
[email protected]

_{PortfolioGPT may earn commission or revenue on some items through the affiliate links in this newsletter.}