Daily Market Reports | Apr 14 2025
This story features BLUESCOPE STEEL LIMITED, and other companies. For more info SHARE ANALYSIS: BSL
US markets rallied sharply on Friday due to rising positive sentiment on tariff negotiations. Mixed tariff messages over the weekend could raise uncertainty again in markets on Monday. ASX200 futures are up 18 points to start the week.
| World Overnight | |||
| SPI Overnight | 7678.00 | + 18.00 | 0.23% |
| S&P ASX 200 | 7646.50 | – 63.10 | – 0.82% |
| S&P500 | 5363.36 | + 95.31 | 1.81% |
| Nasdaq Comp | 16724.46 | + 337.14 | 2.06% |
| DJIA | 40212.71 | + 619.05 | 1.56% |
| S&P500 VIX | 37.56 | – 3.16 | – 7.76% |
| US 10-year yield | 4.49 | + 0.10 | 2.25% |
| USD Index | 99.89 | – 0.82 | – 0.81% |
| FTSE100 | 7964.18 | + 50.93 | 0.64% |
| DAX30 | 20374.10 | – 188.63 | – 0.92% |
Good Morning,
The fast-moving pace of White House tariff updates over the weekend cast another shade of volatility and uncertainty over markets, after a very upbeat trading session on Friday.
What happened on Friday: Extract from Tony Sycamore, IG
US equity markets finished higher on Friday, fuelled by optimism surrounding potential trade agreements and reassurance from the Federal speakers who noted they stood ready to stabilise the market if needed.
At the end of a volatile week, the Nasdaq surged 7.4%, the S&P500 soared 5.7%, and the Dow Jones rose 1897 points, or nearly 5%.
On the data front, March’s US PPI surprised to the downside, with core PPI rising 0.1% month-on-month compared to the 0.3% rise expected.
This further lowered core PCE estimates, which were already soft following the benign March CPI release. The preliminary University of Michigan Consumer Sentiment data, plunged -11% to 50.8 from 57 prior, marking the fourth consecutive month of decline.
One-year inflation expectations rose to 6.7% from 5.0% prior, the highest reading since 1981. A toxic mix of slowing growth and higher inflation.
In the stock space, 1Q 2025 earnings kicked off with mixed results from major banks: Wells Fargo slipped 1%, Morgan Stanley gained 1.4%, and JPMorgan surged 4% after reporting record revenue.
Looking ahead, markets will remain focused on trade developments, particularly the ongoing tensions between the US and China.
Quarterly earnings from companies like Goldman Sachs, Johnson & Johnson, and Netflix will also be closely watched.
Retail sales data will provide insights into consumer health, although investors may partially discount the report due to its coverage of the period before President Trump’s Liberation Day tariff announcement.
Finally, keep an eye on moves in FX and Fixed income markets after the US dollar index, the DXY dropped 3% last week, while the yield on the US 10-year surged 50bp higher last week to close at 4.50%.
The US rates market starts the week almost fully priced for a 25bp Fed rate cut in June with a cumulative 80bp of rate cuts priced by year end.
Follow the Bouncing Potus: Extract Market Call, Ed Yardeni
President Donald Trump’s Nitro Tariffs (TNT) turned out to be the main drivers of the 1-8.9% correction in the S&P500 from February 19 through April 8. Most of that drop (12.3ppts) occurred during the two days after April 2, which Trump declared was “Liberation Day,” when he imposed draconian reciprocal tariffs on 60 countries. We did not believe that day might mark the end of the correction as some market watchers expected.
Sure enough, lots of Americans were liberated from some of their substantial capital gains in the stock market during those two post-liberation days. They recouped some of those losses on April 9, when Trump postponed the reciprocal tariffs but maintained the 145% tariff on China. The S&P500 soared more than 9% that day for its third-largest gain in a single day since World War II.
On Friday evening, the President pivoted again. He said he could offer some exemptions to his 10% tariff on most US trading partners even as he insisted that it was “pretty close” to a floor for nations seeking to negotiate trade deals.
Later that evening, he exempted smartphones, computers, and other tech devices and components from his reciprocal tariffs. Earlier in the day, Trump’s press secretary said the President is “optimistic” that the US and China can strike a deal over tariffs.
So, in a matter of a few days, Trump created a tariff crisis that caused stock prices to fall sharply, then responded to the crisis he had created by providing a series of Trump Puts to boost stock prices. We conclude that the S&P 500’s latest correction most likely bottomed on April 8. Stocks should rally again on Monday.
But wait: Commerce Secretary Howard Lutnick, appearing on ABC’s This Week today, said that Friday’s exemptions applied only to reciprocal tariffs. The administration will be announcing more tariffs on specific products such as chips and pharmaceuticals. As Forrest Gump might have said, “Tariffs are like a box of chocolates, you never know what you’re gonna get.”
US Treasuries: Extract from Michael Howell, CapitalWars Substack, CrossBorder Capital
Consider an Orwellian, 1984-like statement: he who controls the bond market controls the future. Capital Wars are here and China, not Donald Trump is the Great Disruptor.
Adam Smith in the Wealth of Nations (1776) knew how security dominates wealth creation when the two are in conflict. The 1651 Navigation Act was protectionist legislation targeted by Britain on Holland and specifically designed to cripple Dutch trade and inflict huge pain on her economy. Even though this came at the cost of his beloved free trade, Smith noted the Act was “..the wisest of all the commercial regulations of England” because Holland is “the only naval power which could endanger the security of England.”
For England, read America. And, for Holland, read China. China’s economy will be hurt badly by the latest trade bomb. The tariff shock will inevitably send several Chinese businesses to the wall and so worsen China’s credit plight. However, China is fighting back. America’s weakness is her bond market. Treasury Secretary Bessent has to refinance US$9-10 trillion of debt this year at the lowest interest rates possible. His fear is that high interest rates today will reverberate through the maturity structure for years to come and raise the average interest bill. On top, he is fighting a headwind of rising World term premia, made worse by the release of Germany’s debt brake and the unexpected rise of Japanese inflation. Adding a twist to these pressures, China already may be opportunistically selling down her US$720 billion inventory of US Treasuries to cause maximum yield pain to America…
Corporate news in Australia
-Bluescope Steel ((BSL)) estimates a repair bill for Whyalla steelworks of $180m, challenging site plans.
-Ramsay Healthcare ((RHC)) remains on watch status regarding rival Heathscope as lenders look for buyers.
On the calendar today:
-NZ feb net migration
-JP Feb Industrial Prod’n
-CH March Trade Balance
-VIVA ENERGY GROUP LIMITED ((VEA)) Qtr Report
FNArena’s four-weekly calendar: https://fnarena.com/index.php/financial-news/calendar/
| Spot Metals,Minerals & Energy Futures | |||
| Gold (oz) | 3244.60 | + 54.93 | 1.72% |
| Silver (oz) | 31.91 | + 0.84 | 2.69% |
| Copper (lb) | 4.52 | + 0.14 | 3.09% |
| Aluminium (lb) | 1.09 | + 0.01 | 1.39% |
| Nickel (lb) | 6.81 | + 0.19 | 2.91% |
| Zinc (lb) | 1.21 | + 0.01 | 1.17% |
| West Texas Crude | 61.50 | + 1.24 | 2.06% |
| Brent Crude | 64.76 | + 1.23 | 1.94% |
| Iron Ore (t) | 99.95 | + 0.90 | 0.91% |
The Australian share market over the past thirty days
| Index | 11 Apr 2025 | Week To Date | Month To Date (Apr) | Quarter To Date (Apr-Jun) | Year To Date (2025) |
|---|---|---|---|---|---|
| S&P ASX 200 (ex-div) | 7646.50 | -0.28% | -2.51% | -2.51% | -6.28% |
| BROKER RECOMMENDATION CHANGES PAST THREE TRADING DAYS | |||
| ANN | Ansell | Downgrade to Neutral from Outperform | Macquarie |
| DTL | Data#3 | Upgrade to Buy from Neutral | UBS |
| DXI | Dexus Industria REIT | Downgrade to Hold from Add | Morgans |
| EVN | Evolution Mining | Downgrade to Underweight from Equal-weight | Morgan Stanley |
| FMG | Fortescue | Upgrade to Overweight from Equal-weight | Morgan Stanley |
| GDF | Garda Property | Downgrade to Hold from Add | Morgans |
| GMG | Goodman Group | Upgrade to Add from Hold | Morgans |
| HUB | Hub24 | Upgrade to Buy from Neutral | Citi |
| Downgrade to Lighten from Hold | Ord Minnett | ||
| IAG | Insurance Australia Group | Upgrade to Buy from Neutral | UBS |
| IGO | IGO Ltd | Upgrade to Buy from Neutral | Citi |
| Upgrade to Equal-weight from Underweight | Morgan Stanley | ||
| JBH | JB Hi-Fi | Upgrade to Buy from Hold | Bell Potter |
| LYC | Lynas Rare Earths | Downgrade to Sell from Hold | Bell Potter |
| NIC | Nickel Industries | Downgrade to Equal-weight from Overweight | Morgan Stanley |
| NST | Northern Star Resources | Upgrade to Overweight from Equal-weight | Morgan Stanley |
| NWL | Netwealth Group | Upgrade to Buy from Neutral | Citi |
| Downgrade to Lighten from Accumulate | Ord Minnett | ||
| PLS | Pilbara Minerals | Upgrade to Buy from Neutral | Citi |
| PNR | Pantoro | Upgrade to Hold from Sell | Bell Potter |
| PPS | Praemium | Upgrade to Buy from Accumulate | Ord Minnett |
| RIO | Rio Tinto | Downgrade to Equal-weight from Overweight | Morgan Stanley |
| SFR | Sandfire Resources | Upgrade to Outperform from Neutral | Macquarie |
For more detail go to FNArena’s Australian Broker Call Report, which is updated each morning, Mon-Fri.
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CHARTS
For more info SHARE ANALYSIS: BSL - BLUESCOPE STEEL LIMITED
For more info SHARE ANALYSIS: RHC - RAMSAY HEALTH CARE LIMITED
For more info SHARE ANALYSIS: VEA - VIVA ENERGY GROUP LIMITED