US Stocks slid on Trump tariffs uncertainty & stagflation fear

·       Gold waved on the progress of the Ukraine and Gaza war (2nd phase) ceasefire and ongoing Trump trade war tantrum

·       EUR gained on less dovish ECB cuts and progress of Ukraine war ceasefire back channel talks

Wall Street recovered mid-Tuesday of hopes of softer Trump trade policy, tax cuts stimulus, Ukraine mineral deal, and progress of ceasefire ahead of Trump’s SOTU speech. But on early Wednesday, Wall Street Futures again slid on the concern of an imminent recession after a terrible ADP private payroll report, indicating Trump policy uncertainty, while earlier it was also buoyed by talks of Chinese stimulus. Wall Street and also Main Street are now concerned about an imminent stagflation \; i.e. higher inflation, higher unemployment and lower GDP growth.

On Thursday, Trump blinks on his tariffs narrative. Trump’s approach to tariffs on Mexico and Canada has shown significant shifts, reflecting a pattern of inconsistency in his trade policy rhetoric and actions. Initially, during his 2024 presidential campaign and shortly after taking office on January 20, 2025, Trump promised to impose 25% tariffs on all goods from Mexico and Canada, citing the need to address illegal immigration and the flow of fentanyl into the United States. He framed these tariffs as a tool to pressure both nations into enhancing border security, with a similar 10% tariff proposed (and later implemented) on Chinese imports for the same reasons.

The timeline of Trump’s tariff policy toward Mexico and Canada reveals several flip-flops:

Initial Threat and Delay (January–February 2025): Trump announced on his first day in office that he would impose 25% tariffs on Mexico and Canada starting February 1, 2025, unless they curbed drug trafficking and migration. However, after last-minute negotiations with Mexican President Claudia Sheinbaum and Canadian Prime Minister Justin Trudeau on February 3, 2025, he delayed the tariffs by a month to March 4, 2025. Mexico committed to deploying 10,000 National Guard members to its northern border, while Canada pledged a $1.3 billion border security plan, including drones and helicopters. This delay suggested a willingness to negotiate rather than immediately escalate.

Reaffirmation and Implementation (February–March 2025): By late February, Trump reiterated that the 25% tariffs on Mexico and Canada were “going forward on time, on schedule,” as stated in remarks reported on February 24, 2025. True to his word, the tariffs took effect on March 4, 2025, with a 25% levy on most imports from both countries (except Canadian energy products, taxed at 10%). This move contradicted earlier hints from Commerce Secretary Howard Lutnick, who on March 4 suggested a potential “middle ground” compromise might emerge, indicating some internal debate or flexibility.

Sudden Reversal (March 6, 2025): Just two days after implementation, on March 6, 2025, Trump announced a broad rollback of the tariffs on Mexico and Canada, granting a reprieve until at least April 2, 2025, for goods covered under the United States-Mexico-Canada Agreement (USMCA). This shift came after discussions with Sheinbaum and pressure from U.S. automakers, which highlighted the economic fallout of disrupted North American supply chains. The rollback was conditional—Mexico and Canada could avoid future tariffs if they demonstrated progress on fentanyl trafficking by April—but it marked a stark reversal from the hardline stance of March 4.

These flip-flops reflect a mix of motives and pressures from both Wall Street and Main Street. Trump’s initial aggressive tariff threats align with his long-standing view of tariffs as a “beautiful” economic lever, a belief he’s held since his first term when he used tariff threats to secure concessions from Mexico on border security. However, the rapid backtracking suggests sensitivity to economic consequences—markets tanked after the March 4 implementation, and industries like automotive warned of price hikes (e.g., an estimated $2,700 increase per U.S. vehicle). Conversations with Sheinbaum, who presented data showing reduced fentanyl seizures, and Trudeau, who called their talks “colorful,” may have also influenced Trump’s retreat, hinting at diplomatic pragmatism over ideological consistency.

Critics, including Democratic lawmakers like Rep. Gregory Meeks, have called this erratic approach “dangerous,” arguing it abuses emergency powers and risks trade wars with allies. Even some Republicans, like Sen. Susan Collins, voiced concerns over regional economic integration (e.g., Maine’s reliance on Canadian processing). Meanwhile, supporters see it as Trump keeping promises to prioritize American interests, with the rollback framed as a strategic pause rather than a retreat.

In summary, Trump’s latest tariff policy toward Mexico and Canada has oscillated from threats to delays, implementation, and a swift partial rollback within days—all by March 7, 2025. This pattern underscores a tension between his protectionist instincts and the realities of North American trade interdependence, leaving the long-term trajectory uncertain as the April 2 deadline looms.

President Trump’s latest moves on tariffs with Mexico and Canada are a classic example of his “flip-flopping” trade policy. After initially imposing a 25% tariff on many imports from both countries—a decision aimed at pressuring them to tighten border security and curb illegal immigration and fentanyl trafficking—his administration has now delayed full implementation for about one month.

Temporary Reprieve:

Trump’s administration postponed the 25% tariffs on a broad range of goods from Mexico and some from Canada until April 2, 2025. The delay primarily applies to items that comply with the USMCA (the trade pact that replaced NAFTA) such as vehicles and auto parts. In addition, specific sectors—like Canadian energy and potash—continue to see lower tariff rates (10% rather than 25%) during this pause.

Negotiated Concessions:

The tariff pause came after discussions with Mexican President Claudia Sheinbaum and Canadian Prime Minister Justin Trudeau. In exchange, Mexico agreed to deploy National Guard troops (though many of these are redeployments) and Canada committed to measures like appointing a “fentanyl czar” and bolstering border security. However, several analysts noted that many of these concessions were either already in place or could have been achieved without the dramatic tariff threats.

Market and Political Pressure:

The flip-flop was driven partly by significant market volatility, corporate lobbying (especially from the auto industry), and concerns among lawmakers about the potential disruption to the decades-old North American trade relationship. Even though Trump claims these moves are designed to “protect American interests,” critics argue they add uncertainty rather than resolve the underlying issues.

Why It Matters

Trump’s pattern of imposing—and then quickly pausing or scaling back—tariffs is intended to create the appearance of winning a tough negotiation while keeping economic pressure on trade partners. However, this erratic approach has left markets and businesses uncertain about the long-term direction of U.S. trade policy, potentially hampering investment and growth. While the administration insists the measures are tied to combating illegal activities at the border, many observers believe that the actual concessions secured are relatively modest compared to the risks of igniting a broader trade war.

In Summary

Trump’s latest flip-flop means that while his administration will eventually impose tariffs on non-USMCA-compliant goods from Mexico and Canada, there’s now a one-month delay. This temporary pause is meant to ease economic fallout and address industry concerns, but it also underscores the overall unpredictability of his trade policies.

President Donald Trump has recently made significant changes to his tariff policies regarding imports from Mexico and Canada, reflecting a pattern of flip-flops in his trade strategy. Here are the key points regarding his latest decisions:

Key Developments

Tariff Delay: Trump has delayed the implementation of 25% tariffs on many imports from Mexico and some from Canada for a month, until April 2. This decision applies to goods that comply with the U.S.-Mexico-Canada Agreement (USMCA)

USMCA Compliance: Imports from both countries that adhere to the USMCA will be exempt from the 25% tariffs for the next month. However, about half of Mexico's non-USMCA-compliant imports and roughly 62% of Canada's non-USMCA-compliant imports will still face tariffs.

Automotive Tariffs: Trump has also delayed the automotive portion of the tariffs by a month, following consultations with major automakers. This move affects vehicles and components entering the U.S. under the USMCA.

Reasons for Delay: The delay is partly attributed to progress made by Mexico in addressing U.S. concerns, such as combating fentanyl trafficking and illegal immigration. Trump praised Mexico's efforts and cited his positive relationship with Mexican President Claudia Sheinbaum as a reason for the delay.

Economic Impact: The ongoing uncertainty surrounding these tariffs has caused economic instability, affecting consumer confidence and stock markets. Economists warn that the tariffs could increase inflation, reduce economic growth, and cost households significant disposable income.

Retaliatory Measures: Canada has announced countermeasures, such as increasing electricity prices for U.S. customers, in response to the tariff threats. Ontario Premier Doug Ford ordered a boycott of all US products in his province and stated that these measures will remain in place as long as the tariff threat persists.

Future Outlook

Potential Exemptions: There is consideration for exempting some agricultural products from the tariffs, which could provide relief to certain sectors

Broader Tariff Plans: Trump has indicated that more tariffs could be imposed starting April 2, maintaining uncertainty in trade relations with Canada and Mexico.

On Thursday (6th March 25), Trump said:

·       No tariffs on Mexico for USMCA goods

·       Tariff reprieve for Mexico USMCA goods until April 2nd

·       I have agreed that Mexico will not be required to pay tariffs on anything in USMCA

·       Meeting with most of the cabinet, Musk was very positive

·       We will have DOGE meetings every two weeks

·       I had a positive meeting with agency secretaries and Elon Musk

·       Trump puts new limits on Elon Musk – Politico

·       Trump tells cabinet secretaries they will have the final say on personnel and policy at their respective agencies

·       Musk's cost-cutting program DOGE will play an advisory role in these agencies

·       If they don't cut, Musk will do the cutting

·       There’s a good chance we can balance the budget next year

·       Trump on Truth Social: I instructed secretaries and leadership to work with DOGE on cost-cutting measures and staffing

·       CMA CGM shipping company will invest $20 bln in the US

·       I will announce a new program for shipbuilding soon

·       Predominant tariffs will be reciprocal

·       Program for building ships will involve incentives

·       Most tariffs will start on April 2 and be reciprocal

·       I am not even looking at the market

·       There will be a short-term disruption and, long-term economy very strong

·       Steel and aluminum tariffs will not be modified

·       Trump on steel & aluminum Tariffs: It will happen next week

·       Trump on tariffs: The big one will happen in April

·       Canada and India are high-tariff nations

·       We don't need trees, cars, or energy from Canada

·       No USMCA exemption for auto tariffs next month

·       No USMCA exemption for auto tariffs next month

·       We made a lot of progress with Russia and Ukraine in the last 2 days

·       I told automakers it was a short-term deal on tariffs

·       I would like to start denuclearization talks

·       I have discussions with Hamas, and helping Israel. Not giving cash

·       If NATO countries don't pay, the US won't defend

·       NATO countries still not paying enough

·       I told automakers not to come back on April 2nd

·       We have to protect Japan, but they don't have to defend us

·       Ukraine wants a deal

·       I am not sure if allies would defend us

·       I will be going to Saudi Arabia. They have agreed to a large investment

·       I would probably extend the TikTok deadline

·       I will change trade deficit today - Truth Social

·       Canada's PM Trudeau is using the tariff problem to run as PM again

On Thursday, Mexico’s President Sheinbaum said:

·       The call with Trump was excellent and respectful

·       We will keep working together, particularly on migration and security, particularly the crossing of fentanyl into the US

·       The agreement to pause tariffs on Mexico's USMCA-compliant goods is until April 2nd

·       Mexican President confirms tariff agreement with Trump

·       Practically all of the trade we have with the US is under USMCA

·       This will not be the last call with Trump

·       The trade team will continue working on a deal this month

·       We want to focus on 10-yr yield and what the administration can do to bring that down

·       The US does not have a revenue problem, we have a spending problem

·       Mexico must reduce dependence on energy imports

·       Trump believes tariffs are a good source of revenues, protect US workers and create negotiating leverage

·       Mexico imports a lot from China. We don't have a free trade deal with China.

On Thursday, Canada's PM Trudeau said:

·       Canada is continuing to talk to the US administration; its goal is to get tariffs lifted

·       Trump and I are committed to work together on the border

·       Canada is continuing to talk to the US. The goal is to get tariffs lifted.

·       As long as there are tariffs on us from the United States that are completely unjustified, we will be responding strongly

·       Canada-US trade war to persist for the foreseeable future

·       We're in discussions on possibly delaying the second wave of our planned tariffs

·       Any carve-outs from US tariffs that support any workers in Canada, even if it's just one industry, are going to be a good thing

·       Trudeau indicates that the trade war isn't about to end

·       US Commerce Secretary Lutnick's most recent comments are a promising sign and align with some of the conversations that we have been having with administration officials

On Thursday, the US Treasury Secretary Bessent said:

·       Access to cheap goods is not the essence of the American dream

·       The US will close Iran's access to the global financial system

·       Trump's tariff policies have begun the process of reorienting our international economic relations

·       We won't hesitate on Russia sanctions if needed

·       Banks have been weighed down by unduly burdensome regulatory requirements and a broken supervisory culture

·       The Trump administration has kept enhanced sanctions in place and will not hesitate to go all in should it provide leverage in peace negotiations

·       We are identifying non-tariff barriers and laws that unfairly apply fines to US exporters

·       The Trump administration is identifying actors that undercut competition, suppress wages, and manipulate currency

·       Over-use of sanctions could affect US dollar supremacy

·       Sanctions will be used explicitly and aggressively for maximum immediate impact

·       We are going to shut down Iran's oil sector and drone manufacturing capabilities

·       We said, with these tariffs, how are we going to be able to keep cooperating on security

·       Tariffs can be a one-time price adjustment

·       I hope the Fed team 'transitory' regroups on tariffs

·       Bessent cites drop in mortgage rates and oil in inflation view: I'm not worried about inflation across the continuum

·       Trump's April reciprocal tariffs will be path-dependent depending on our trading partners

·       The US will look at EU's massive fines on US tech firms

·       Notice, Trump has stopped calling for Fed to cut rates

·       We are considering full expensing of factory investments (CAPEX/DEPRECIATION)

·       A lot of affordability crisis is due to high energy prices

·       The closer we get to tax-cut expiration, uncertainty increases

·       The longer we wait on extending tax cuts, the higher the chances are that taxes will increase

·       Tariff income could be very substantial

·       Tariffs are not regressive if they fund no tax on tips

·       Tariff policy can finance income tax cuts and income gains for the bottom 50% of wage earners

·       I will give an important message during the Sunday event

·       China exported policies to the US and tariffs are a pushback

·       Very likely that portions of the USMCA agreement will start being looked at before the 2026 review

·       We must revise our tariffs with China

·       We will re-leverage the private sector

·       Private credit is exciting and new in capital markets

·       The US to become a major exporter of energy

·       We have focused on small businesses and consumers

·       We will continue the surge in small business confidence

·       We will get bank lending going again

On Thursday, a White House Official said:

·       One-month exemptions to 25% tariffs on Mexico and Canada are going to cover all USMCA-covered goods

·       The US could drop tariffs on Canada and Mexico with fentanyl progress

·       Some Canadian energy is still subject to a 10% tariff

·       US pauses until April 2nd tariffs on Canada and Mexico USMCA trade

·       White House: Trump to exempt Canadian and Mexican products (under USMCA) from tariffs

The US Commerce Secretary Lutnick said:

·       The fact the stock market goes up or down every day is not the driving force of our outcomes

·       April 2nd is when we begin reciprocal tariffs

·       We need to see fentanyl deaths decline

·       USMCA goods-related tariff delay likely until April 2nd

·       Hopefully by April 2nd, Mexico and Canada will have done enough on fentanyl that this part of the conversation is over, and it will just be about reciprocal tariffs.

·       Trump may decide on USMCA tariff delay today.

·       I expect that on April 2nd reciprocal tariff rates start high, and then start coming down.

·       Tariff reprieve coming today. It's likely to include all USMCA products

·       I think over 50% of Canada and Mexico products are USMCA compliant, that is an off-the-cuff estimate

·       We know exactly what the President wants, suggesting his advisers don't know what he's thinking is silly

·       New US manufacturing jobs will be high-paying

·       Re-shored US manufacturing jobs will use robotics and AI

Tariffs won't fund US Sovereign Wealth Fund

Trump’s flip-flops on his tariffs narrative are also creating uncertainty in both Wall Street and Main Street.

Recent Tariff Rhetorics

Canada and Mexico: On February 1, 2025, President Trump signed executive orders imposing a 25% tariff on all goods from Mexico and Canada, with a 10% tariff specifically on Canadian energy exports, including oil, natural gas, and electricity. These tariffs were initially set to take effect on February 4 but were delayed by one month following negotiations. They officially went into effect on March 4, 2025.

European Union: On February 26, 2025, President Trump announced plans to impose a 25% tariff on goods imported from the European Union, citing concerns over trade imbalances and national security.

Administration's Justifications:

Economic and National Security: The administration argues that these tariffs are designed to reduce the U.S. trade deficit, protect domestic industries, and address national security concerns. President Trump has linked tariffs to various issues, including boosting domestic manufacturing, curbing illegal immigration, and combating drug trafficking.

Global Reactions and Economic Impacts:

Retaliatory Measures: In response to the U.S. tariffs, Canada implemented 25% retaliatory tariffs on U.S. goods starting March 4, 2025. Mexico has announced plans to unveil its response on March 9, 2025.

Tariffs on China

Escalation: Trump increased tariffs on Chinese imports to at least 20%, following a previous 10% tariff. This move is part of an ongoing trade confrontation with China despite the US-China trade deal signed in January’2020

China's Response: Beijing vowed to fight the trade war "to the end," criticizing U.S. unilateralism and warning of disruptions to global supply chains

China's Position: Chinese leadership has expressed concerns about the potential isolation resulting from U.S. trade policies. President Xi Jinping is particularly worried about the implications of these tariffs on China's economy and global standing.

Economic Analyses:

Domestic Impact: Analysts warn that these tariffs could lead to higher consumer prices in the U.S., increased production costs for manufacturers relying on imported materials, and potential job losses in industries affected by retaliatory measures.

Global Supply Chains: The tariffs are prompting companies to reassess their supply chains, with some considering relocating production to mitigate the impact of increased costs.

In summary, the recent tariffs imposed by the Trump administration have sparked a series of retaliatory actions and raised concerns about global economic stability, with potential implications for international trade relationships and domestic economic conditions. President Trump has recently implemented significant tariffs on imports from Canada, Mexico, and China, escalating tensions in global trade. These actions have prompted swift retaliatory measures from affected countries, contributing to a volatile economic environment.

Tariffs on Canada and Mexico

Implementation and Retaliation: The U.S. imposed a 25% tariff on imports from Canada and Mexico, with a 10% tariff on Canadian energy products. Canada responded by announcing tariffs on over $100 billion worth of U.S. goods, while Mexico's tariffs were not immediately detailed.

Temporary Exemption: Trump granted a temporary exemption for certain Canadian and Mexican goods covered under earlier USMCA trade deal until April 2, specifically for automakers complying with the USMCA.

Economic Impact and Reactions

Global Trade Deficit: The U.S. trade deficit reached a record high in January, partly due to increased imports to avoid additional tariffs.

Inflation Concerns: Economists warn that these tariffs could lead to higher inflation in the U.S., potentially forcing the Federal Reserve to adjust its monetary policy

Retaliation and Trade War: The situation has sparked fears of a broader trade war, with other countries like the EU preparing retaliatory measures

Overview of Recent Tariff Actions

President Trump has implemented sweeping tariffs on imports from major U.S. trading partners—Canada, Mexico, and China—as part of his second-term agenda. On February 1, 2025, he signed executive orders imposing 25% tariffs on most goods from Canada and Mexico and a 10% tariff on Chinese imports, effective from March 4, 2025. Subsequently, on February 10, 2025, Trump escalated tariffs on steel and aluminum imports to a flat 25%, eliminating previous country exemptions and quotas, also effective March 4, 2025. These measures build on his earlier trade policies from 2018-2019 and are justified by the administration as responses to issues like illegal immigration, fentanyl trafficking, and trade imbalances.

Economic Impact

Tax Foundation Analysis (March 5, 2025): The Tax Foundation estimates that the 2018-2019 Trump-Biden tariffs (Section 301 on China and Section 232 on steel/aluminum) reduced long-run U.S. GDP by 0.2%, the capital stock by 0.1%, and employment by 142,000 full-time jobs. The newly imposed 25% tariffs on Canada and Mexico are projected to further shrink GDP by 0.2% and reduce hours worked by 223,000 full-time equivalent jobs, while increasing federal revenue by $3.8 trillion over 2025-2034 (or $3.1 trillion dynamically, accounting for retaliation). These tariffs are expected to raise consumer prices without impacting pre-tax wages long-term due to a proportional reduction in the capital-to-labor ratio.

Consumer and Business Effects: Businesses, particularly in the automotive, agriculture, and retail sectors, warn of higher costs. For instance, the auto industry anticipates a potential $12,000 increase in new car prices, with production cuts possibly affecting 20,000 units daily. U.S. farmers, already hit by $27 billion in lost exports during Trump’s first-term trade wars, face renewed threats from retaliatory tariffs.

Retaliatory Measures

Canada: Prime Minister Trudeau announced retaliatory tariffs on $30 billion of U.S. goods on March 4, 2025, with further measures planned if tariffs persist. Canada intends to challenge the U.S. at the World Trade Organization (WTO) and under the U.S.-Mexico-Canada Agreement (USMCA).

Mexico: President Claudia Sheinbaum vowed retaliatory tariffs, with specifics to be announced by March 9, 2025, signaling a potential delay in negotiating de-escalation.

China: China doubled its tariffs on U.S. goods to 20% and plans a WTO challenge, arguing that U.S. actions violate international trade rules. Beijing has also hinted at broader countermeasures, including restrictions on mineral (rare earth materials) exports.

Broader Implications

Global Trade: The tariffs threaten $2.2 trillion in annual U.S. trade with Canada, Mexico, and China, potentially disrupting integrated North American supply chains and global trade flows. The Council on Foreign Relations (February 5, 2025) highlights that Canada and Mexico, reliant on U.S. trade for 70% of their GDP, face severe economic pressure, while China’s diversified trade mitigates meaningful impact.

Inflation and Growth: Economists warn of renewed inflationary pressures, with the Atlanta Federal Reserve’s GDPNow model projecting a -2.8% GDP contraction for Q1CY25 (revised from +2.3% growth), driven by tariff-related uncertainty and subdued consumer spending.

Geopolitical Tensions: Trudeau speculated that Trump aims to weaken Canada economically for annexation, while China frames the tariffs as undermining U.S.-China cooperation, potentially affecting anti-drug efforts.

Administration’s Stance

Trump defends the tariffs as leverage to protect national security and economic interests, citing past successes like the USMCA renegotiation. Commerce Secretary Howard Lutnick suggested on March 4, 2025, that partial resolutions with Canada and Mexico might modify (but not eliminate) tariffs, contingent on their cooperation on fentanyl and migration issues.

Ongoing Developments

Reports indicate Trump is considering additional tariffs on the European Union, steel, semiconductors, and pharmaceuticals, with announcements possibly forthcoming. The situation remains fluid, with markets and analysts closely monitoring for signs of negotiation or further escalation.

Conclusions:

China is far ahead of the US in terms of industrial and infra ecosystems. Thus Trump can’t compete with Chinese manufacturing global supremacy by simply imposing tariffs and encouraging domestic inefficiencies. Trump has to invest much more in fragile US infra to compete with mighty China and Make America Great Again!

It may be also very tough to predict whether the present US-Russia ‘Bromance’ will continue or not after President Trump’s 2nd term ends in 2029. Trump is also now interested in having a good competitive relationship with arch-rival China as the two largest economies now contributing almost 50% of the global GDP- also needs each other for prosperity and development.

For most of the US MNCs, China is now the 2nd largest market. Thus corporate America led by Musk & Co (US tech lobby) may not allow Trump 2.0 as Trump 1.0 in terms of trade and tech war. Trump 2.0 may be much more moderate than Trump 1.0 in terms of trade, tech, and cold war with China and also Russia. Trump 2.0 may be much more hawkish with the EU, Canada, Mexico, Japan, and other allies. Trump 2.0 may even abandon NATO in the future.

Europe/EU now has to stand up on its own feet after being dependent on the US for almost 80 years. EU has to build its own military force and foreign policy. Europe now has to make a security deal with ‘mighty’ Russia rather than too much Russia phobia, leading to the Ukraine war. EU also has to accept China as the number one superpower in terms of economy, technology, and development and keep good relations for mutual benefit rather than too much dependency on the US, which has no policy stability under Biden and Trump admin.

Bottom line:

For Mexico and Canada, Trump may blink at the last moment citing progress on illegal immigration and the Fentanyl issue. Overall, the Trump trade war may be more harmful to the US economy (as importers) rather than exporters. The US needs cheaper imported goods from countries like China, Mexico, Canada, and many other trading partners to maintain the Goldilocks nature of the economy. At present, the US can’t match the cost efficiencies of imported goods and is thus bound to place orders for import. No exporter will pay any tariffs for those and US importers have to pay tariffs, which may be passed on to the US consumers eventually.

Market Wrap:

On Thursday, Wall Street Futures plunged on Trump tariffs uncertainty despite Trump partially dialing back some of his tariffs narrative for another month. The S&P 500 slid 1.8% and the Nasdaq-100 tumbled 2.6%, both hit their lowest level since November, while the Dow Jones dropped 428 points. Treasury Secretary Bessent’s endorsement of tariffs raised concerns about the administration’s long-term trade stance, further unsettling Wall Street. Tech stocks led the decline, with Marvell Technology tumbling after a disappointing AI-driven sales forecast, dragging Nvidia, Broadcom, and AMD significantly lower.

On Thursday, Wall Street was dragged by consumer discretionary, real estate, techs, communication services, utilities, banks & financials, industrials, materials, healthcare, and consumer staples, while boosted by energy as oil recovered from OPEC production hike ‘shock’. Gold waved on the progress of the Ukraine and Gaza war (2nd phase) ceasefire and Trump tariffs tantrum. EUR and GBP gained, while USD is pained on Trump’s tariffs flip-flops and progress in Ukraine war ceasefire back-channel talks. EURUSD also surged on less dovish ECB cuts.

BTCUSD stumbled despite US President Trump signing an executive order to create a Strategic Bitcoin Reserve. White House Crypto and AI czar David Sacks announced that the reserve would be funded exclusively with bitcoin seized through criminal and civil forfeiture cases, ensuring no additional financial burden on taxpayers. The US government currently holds about 200,000 bitcoins, valued at approximately $18 billion. The order also established a US Digital Asset Stockpile to hold other confiscated crypto assets. However, the news failed to spark investor enthusiasm, as the US government will not be purchasing bitcoin to fund the reserve, which meant no new buying pressure on the market, resulting in a classical buy the rumor and sell the fact market reaction.

Weekly-Technical trading levels: DJ-30, NQ-100, Gold and BTCUSD

Looking ahead, whatever the fundamental narrative, technically Dow Future (CMP: 43850) now has to sustain over 44050 for any further rally to 44250/44400-44500/44800 and 45000/45200-45300/45500 and 45700/45800-45900/46000 in the coming days; otherwise sustaining below 44000, DJ-30 may again fall to 43800/43675-43300/43150 and 42800/42700-42000/41900 in the coming days.

Similarly, NQ-100 Future (20915) has to sustain over 21050 for a further rally to 21300/21500-21700/21850 and 22050/22200-22350/22500 and 22700/23000-23300/23500 in the coming days; otherwise, sustaining below 21000, NQ-100 may again fall to 20900/20600-20400/20150 in the coming days.

Also, technically Gold (CMP: 2855) has to sustain over 2830 for a further rally to 2870/2905-2925/2955 and 2965/2975-3000/3025 and 3050/3075; otherwise sustaining below 2825 may further fall to 2810/2795-2780/2765 and 2745/2725-2695/2665 and further 2635/2600-2585/2560 in the coming days.

Similarly, BTSUSD (CMP: 90000) now has to sustain over 95000 for a further rally to 98000/10000-103000/105000 and 108000/110000 levels for the next leg of the rally, otherwise, sustaining below 94000/94500, may again fall to around 90000/88000-86000/84000 and 82000/80000-78000/75000 and 73000/60000-50000/44000 and 35000/33000 in the coming days.