Markets Cheer 90-Day Tariff Truce as Tech and Cyclicals Explode Higher
Market Brief: “Green Shoots or Tariff Truce Sugar Rush?”
I. Headlines & Catalysts
Markets surged after the White House announced a 90-day tariff pause with China, sparking hopes of de-escalation. Trump revealed that China agreed to open markets to U.S. businesses, while Treasury Secretary Scott Bessent confirmed fresh negotiations are on deck, targeting tough sectors like semiconductors, steel, and pharma.
The tariff truce came with a warning: if inflation creeps up, more stimulus-like tailwinds could mean stickier CPI — and tomorrow’s inflation data will test that theory.
Sentiment? Risk-on. Volatility? Contained. VIX slipped to 18.39 — below 20, signaling calm with a cautious squint.
COMPQX gapped up and closed strongly above the 200-day SMA. This type of price action indicates strong momentum, especially with significant volume support. As always, stay open to both scenarios: continuation of the uptrend or a potential gap-fill from yesterday’s move.
“Markets rallied like it was Black Friday and tariffs just got 90% off.”
II. Sector Performance Snapshot
This was a textbook high-beta, pro-growth rotation fueled by a geopolitical sigh of relief. When tariffs fall, global demand-sensitive sectors like Consumer Cyclical, Tech, and Industrials tend to rip — and that’s exactly what happened.
High-beta rotation. Cyclicals and Tech exploded, while Defensives and Utilities hid behind the curtain. This was a bullish realignment — growth over value, cyclicals over defensives, risk-on over yield — and could continue if inflation stays tame and yields remain contained.
III. Technical Breadth & Sentiment Check
- Advancers > Decliners ✅
- Stocks above 40SMA: 63.87% 🟢
- Stocks above 200SMA: 34.6% 🟡 (improving, but still cautious)
- VIX at 18.39: Green Zone 🟢
- McClellan Oscillator: 136.75 🔴 (a bit frothy)
- Put/Call Ratio: 0.85 🟢 (healthy)
- NAAIM Exposure: 81.06 🟢 (active managers are bullish)
Breadth was solid but not euphoric. “A strong push, but not yet a parade.”
IV. Earnings & Corporate News
- Apple $AAPL (▲6.32%) soared after Trump met with Tim Cook — iPhones may get pricier, but not because of tariffs. Apple’s playing both sides, and stockpiling inventory ahead of trade hiccups.
- General Motors $GM (▲4.44%) hired Tesla Autopilot vet Sterling Anderson as CPO. Big EV brains entering GM’s garage.
- Chegg $CHGG (▲7.51%) jumped after announcing 22% layoffs, cost-saving plans up to $110M by 2026. AI may be disrupting it, but Wall Street likes “leaner” education.
V. Economic Calendar Highlights
Today:
- NFIB Business Optimism Index
- CPI (8:30 AM ET) — key for inflation outlook
- Household Debt Report (11:30 AM)
Earnings on Watch:
- Pre-Market: $JD, $SE, $ONON, $CYBR, $LUNR, $UAA, $PSFE, $ALT
- Post-Market: $NU, $KRMN, $OKLO, $GRAL, $GEVO, $INO
VI. Interpretation & Outlook
The market responded with enthusiasm to the 90-day tariff truce. Breadth is improving, volatility is contained, and bullish sentiment is creeping in — but the technical picture isn’t fully healed. Only ~35% of stocks are above their 200-day moving average, and some momentum indicators are flashing “hot.”
The real test comes tomorrow: CPI data at 8:30 AM ET. Inflation has been decelerating, but any surprise uptick could challenge this rally — especially with rates and Fed expectations still delicately balanced.
“Markets are in celebration mode — but inflation data might be the hangover cure.”
What to trade today:
Very good price action during last days for $TSLA, $SOUN, $PANW and $LOAR. Do not chase the gappers, they are gone, look for other opportunities. My approach is to pull the trigger when I see low-risk entries.
For today, I will watch: $ARM, $AXON, $BIVI, $CELH, $COST, $NNE, $PLTR, $TEM.
