After the week we just lived through, it’s understandable that we need to take a breather and not get too excited. Yet the problems remain the same, and the doubts regarding tariffs are still ever-present. The temporary gift Trump gave to all electronics and their components was the session’s “driver,” but to be honest, while Europe benefitted, it was less striking in the US. You can tell that no one “really” believes in it, and Apple, which was supposed to be the “big winner” from the weekend’s news, only ended up 2.2% higher after opening with a +7%. No one’s buying into it, and we’re expecting a backlash.
Two days in a row
But hey, we’re not going to complain — it can’t go up 10% every day, and the US indices still posted their second consecutive day of gains. That hadn’t happened in a while. So let’s not get carried away and start saying a trend is forming, but let’s just say that “for now,” it’s A BIT CALMER than what we experienced last week. At the same time, it would’ve been hard to imagine worse — especially on a Monday — but the week’s not over yet, even if it will be shortened by Good Friday.
In any case, we’re still living in the same world, and even if there are a few more corporate updates—ones that manage to break through the flood of statements from Trump and his team—the overall obsession remains tariffs. Let’s not kid ourselves. Yesterday, the American President again expressed his intention to find a solution to “relieve” the tariffs imposed on car manufacturers. And even if his objective wasn’t very clear in substance or form, it at least gave some breathing room to companies like GM or Stellantis — even if, again, the new moratorium Trump wants to announce for the sector is very unclear. It feels like we’re so desperate for good news or even just a little clarity in this shitty geopolitical environment (sorry, couldn’t find a synonym) that we’re willing to believe or get excited over anything.
The mood was good, but nothing more
To put it simply, the markets ended higher because of the electronics announcement that came over the weekend, but right after the announcement, Trump and Lutnick were quick to say we shouldn’t celebrate too soon. So the market found it hard to get fully motivated, knowing that a 180-degree reversal could come in the next few days. Hence, the performance was average at best, and overall, lacked enthusiasm. As the title said: it was too quiet. Europeans, on the other hand, were more motivated than the Americans — as if they were enjoying a quiet Monday with no major breaking news to catch up on last week’s performance.
So, while we wait for the next batch of announcements from the “Trump Team” — which will surely hit us in the face before the Easter egg hunt — market players are acting “as if” none of it concerns them and, for now, trying to get back to normal life. Focus then shifted to Goldman Sachs’ figures. And yes, I know — we usually don’t care much about bank earnings. Even though they’re kind of the “barometer” for the beginning of earnings season, we generally know they don’t mean much. That’s because, if we’re being honest about analyst expectations, there’s no worse scenario than one banker analyzing another banker’s performance. Usually, they’re off the mark in many sectors, but when it comes to banks, it’s often completely out of touch. It’s like no one’s ever managed to read a bank balance sheet without having a seizure by page eight, and since then, after so many ER visits, the analysts covering the banking sector just throw darts at the wall to set expectations. It’s statistically safer.
So Goldman Sachs ? The good news is that the sector’s been so beaten down since people began to realize that Trumponomics would bring back inflation, a recession, locusts, and a zombie apocalypse, that expectations were low. As a result, the queen of investment banks — nicknamed “the vampire squid” for years thanks to a Rolling Stone article — reported numbers well above expectations. Of course, when you expect nothing based on almost nothing, it’s hard to miss the quarter. The “BANK BALANCE SHEET ANALYSIS EXPERTS” were expecting $12.35 per share, and it came out at $14.12. The quarterly profit hit $4.74 billion, well above expectations. Last year, during the same period, profit was $4.13 billion. The bank also announced a share buyback program of up to $40 billion, and during the press conference, the CEO said recession risks are increasing due to tariffs and that the US economy is at risk, but that THEY are confident in themselves. It must be said that trading revenues for the first three months of the year were over $4.2 billion. So when people talk about volatility, at Goldman they say: Long may it last!!!
Numbers, numbers and more numbers
It wasn’t just Goldman reporting yesterday – LVMH also had something to say. And the result? Not exactly mind-blowing, although there’s still plenty of hope for the future. Bernard Arnault had a bit of a rough patch in Q1 – but let’s be clear, he can still afford a €100 million townhouse in central Paris (and not in the sticks), with enough cash left to pick up one or two Ektorp sofas from Ikea. Now that we’re all reassured about Bernard’s standard of living, let’s note that sales were down 2%, at €20.3 billion. Nothing dramatic, but the real issue is in the US – a key market for them – AND OBVIOUSLY it’s due to Uncle Donald’s lovely tariffs. The group says it’s staying calm, confident… but also on guard, because the whole thing kind of smells like a highway rest stop toilet in July. CFO Cécile Cabanis is hoping the 90-day truce will allow for some negotiation, but the real message is: “we’re crossing our fingers, but it’s not up to us.”
Fashion and Leather Goods are doing okay, same for Watches and Jewelry, but overall sales in the US are slipping. Cognac is taking a hit (pun intended), with drops in the US and China. To try and soften the blow, they even shipped stock in advance. Not exactly a long-term strategy, but if this doesn’t drag on too long, it might do the trick. Arnault is playing the silence card. He was at Trump’s inauguration with his kids in full “luxury dynasty” mode, but he’s still looking at expanding Vuitton and Tiffany workshops in the US. Meanwhile, Macron is like: “Let’s hold off on US investments and see how this plays out.” Honestly, it’s hard to tell who’s giving orders to whom.
Bottom line: LVMH is in a grey zone. Sales are dipping a little, but no need to panic – unless this drags on. If the Chinese could just wake up a bit, that’d be great. The stock was down 6% in the US last night – now we’ll see how Paris handles it.
Over in Asia
This Tuesday, Asian markets are mostly up and smiling… but it’s the tight-lipped smile of someone waiting for a vasectomy. Basically, everyone’s hoping Trump will ease up on his famous tariffs, handing out a few exemptions like a protectionist Santa Claus. In that “cautious optimism” mindset, indexes are gently climbing – kind of like next quarter’s US growth: soft, uncertain, and mostly running on hope. China is doing its own thing: up one day, down the next. Beijing is neck-deep in trade drama with Washington, and even though a few exemptions were handed out, Trump made it clear it’s just temporary. So yeah – the vibe is “We’re breathing… but not too loud, and walking on eggshells.” Nikkei is up 1%, Hong Kong up 0.2%, and China down 0.1%. I’m telling you, it’s too quiet. We’re not used to this anymore.
As for commodities, WTI is at $61.71 to start the session. The oil barrel is getting a boost from Trump’s fresh batch of tariff exemptions. By the way, these so-called “tariff exemptions” are like the Ozempic of global finance – they’re the go-to excuse for just about any price bump:
Gold at $3,245? Must be the exemptions.
Bitcoin up $200 to $85,200? Blame the exemptions.
Goldman Sachs nailed earnings? You guessed it – exemptions.
Apple bouncing back? Okay, yeah, this one’s actually true…
Taxes going up in France again? Totally the exemptions.
You get the point: it explains everything.
Now, if you want to sound all professional, you could say WTI is also rising due to a rebound in Chinese crude oil imports in anticipation of tightening Iranian supply. Sounds fancier, doesn’t it?
News not involving “tariff exemptions”
In non-exemption-related news, Palantir jumped nearly 5% yesterday because NATO is going to use their AI software to boost their combat capabilities. Great for Palantir, but not sure that’s a win for humanity. Or maybe I’ve just seen Terminator one too many times. Let’s not forget – he did say “I’ll be back” more than once.
Also, as of last night, the S&P500 entered “DEATH CROSS” mode. Sounds like a Norwegian metal band or a World of Warcraft spell, but it’s actually just a technical signal. And not a cheerful one. A Death Cross happens when the 50-day moving average crosses below the 200-day moving average. Basically: trend’s turning bearish.
Why call it “death”? Because in chartist lingo, that’s the smell of pinewood (i.e. bad news). Historically, this crossover signals a downward turn. It’s like the market whispering: “Alright folks, party’s over – get your bulletproof vests.”
But! It’s not an exact science. Stats going back to 1950 show that a month after a Death Cross, the S&P500 averages -0.5%, but then it’s up 2.5% in the next quarter, up 4.2% over six months, and 5.8% over a year. If that’s “bad news,” I can’t wait to see the good ones.
In short: Death Cross is a red flag on the dashboard. Not necessarily an immediate crash, but probably a good time to tighten the belt, check your brakes, and maybe stop aping into leveraged Nasdaq positions. And remember: in the end, the Bulls always win!
Also worth noting: Chinese exports in March shot up by +12.4% (in USD) year-on-year, when analysts were expecting just +4.4%. That’s the strongest growth since October 2023. Companies sped up international shipments to beat the new American tariffs (thanks again, Trump!). Basically: “Quick, load the container before it costs a kidney.” Meanwhile, imports dropped -4.3%, when only -2% was expected. Translation: China’s domestic demand is still sluggish, despite all the speeches about a rebound. Yet another bummer for Bernard Arnault – although he’s still buying that €100 million penthouse anyway…
Today’s numbers
Today, we’re waiting on the CPI in France, the ZEW index in Germany and Europe, and the New York Empire State Manufacturing Index. For those who love parsing rate hints in speeches, Madame Lagarde is scheduled to talk today. On the earnings front, we’ve got more banks reporting – including Bank of America, Citigroup, and Johnson & Johnson (which, for now, is not a bank…).
Futures are down 0.09% and things are still eerily quiet.
That’s it from me – have a great day, and I’ll catch you tomorrow to see if Trump’s come up with something new. It’s wild how we’ve gotten so used to the chaos that when nothing happens… we’re actually bored.
See you tomorrow!
