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The last two weeks of investors who bought DIP, given that the S&P 500 and Nasdaq Composite have returned 13 % and 16 % since April 9, when President Trump stopped the customs tariff he announced on April 2, the so -called “Liberation Day”.
The gains of the stock market occurred despite the data that indicates that the American economy slows down and anxiously that the customs tariff may mean stagnation, or worse than that, the recession is waving on the horizon.
What happens to the following stocks, however, is not clear. The main market indicators have risen to resistance, and some feelings of feelings flashing at the height of the purchase.
Related: The veteran analyst sends an urgent message on the S&P 500
The uncertainty of the impact of customs tariffs on stocks, including a 145 % amazing tax on Chinese imports, has prompted many of the most influential market monitors to share ideas, including the director of the legendary billionaire hedge fund Paul Tudor Jones.
Jones tracked fixed organic pollutants in the market and declined since the mid -seventies of the twentieth century, but he was famous for the hedge box, Tudor Investment Corporation. His success in money management, including predicting a 1987 accident, led to its inclusion in Market treatments A series of books.
Over the past fifty years, Jones has managed to manage billions of dollars during the bull and bear markets. Looking at his record, Jones revealed the stock market expectations this week that investors may not want to ignore it.
The Federal Reserve may be identified with definitions
The double federal reserve is aimed at inflation and low unemployment. However, these goals are contradictory, and often causes the federal reserve behind the curve when setting monetary policy.
For example, when the federal reserve raises interest rates, it slows down the economy, contributes to the demobilization of workers, but slows inflation. However, when it reduces interest rates, it speeds up the economy and enhances employment, but it increases inflation.
This relationship is easily seen on how monetary policy affects the economy over the past few years. In 2022, Federal Reserve Chairman Jerome Powell began a policy of raising the most difficult prices since the 1980s after he was incorrectly expected inflation during 2021. The decision to delay the increase in an increase in inflation in the sky, which peaked by 8 % in June 2022.
The federal reserve tightening has pushed in response to inflation to less than 3 %. However, these increases caused cracks in our labor market. The unemployment rate increased to 4.2 % of 3.4 % in 2023, and workers’ layoffs rise.
In the first quarter, companies announced 497,000 layoffs, according to Challenger, Gray & Christmas. This was the most in the first quarter since 2009 that was reinforced in the recession. In April, 105441 people were demobilized, an increase of 63 % on an annual basis.
The photo of the weak jobs to the Federal Reserve to switch the gears, leading to interest rate discounts in September, November and December. However, these cuts contributed to sticky inflation, forcing the Federal Reserve on the margin, pending more data.
The Federal Reserve job has become more difficult with definitions.
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The proposed “liberation day” was much higher than expected, as they were sent shock waves across the stock market, forcing many to reset the forecast of GDP growth and profit growth.
Since then, President Trump has stopped many mutual tariffs, but the 10 % foundation tariff, and a 25 % tariff in Canada, Mexico and cars, and a 145 % tariff in China is still valid. As a result, supply chains show stress, consumer confidence and business are tanks.
The Conference Council’s expectations decreased 12.5 points to 54.4 in April, its lowest level since October 2011. Historically, readings of less than 80 indicate stagnation forward.
Likewise, consumer morale scanning at the University of Michigan decreased by 8 % to 52.2 in April, the fourth light of its width for April since 1952. In the survey, inflation forecast for next year increased to 6.5 % from 5 % last month.
Paul Tudor Jones says the shares will decrease
The history of Paul Tudor Jones gave him the Wall Street seats in the front -row of high inflation in the 1970s, the S&L crisis in the late eighties and early nineties, the internet and statue boom, the great stagnation, the coffee, and the 2002 bear market.
Related: Warren Buffett sends a strong message about trade, definitions
Saying that he saw something or two over his career may reduce things. This makes the latest stock market comments more worrying.
“You have Trump, who has been imprisoned on customs duties, you have to keep not lowering prices,” said Paul Tudor Jones. CNBC. “This is not good for the stock market. We are likely to go to its lowest level.”
But what about commercial deals? Can these shares cause higher? maybe. But the deals are likely to be very large, and this may be unlikely to consider Trump’s clear commitment to the customs tariff scheme.
“Even when Trump wears China to 50 % … or 40 % … it’s the biggest tax increase since the 1960s,” said Jones. “Therefore, you can take 2 % to 3 % of growth.”
If Jones’s look is correct, a great success for GDP growth can force Trump and take measures that the markets likely to find friendly.
“When we are at the lowest new levels, solid data will begin to follow up, and the Federal Reserve may be created to move, and Trump’s creation to move,” Jones said.
Related: The Veteran Fund Director reveals the prediction of the S&P 500
