Closing Recap

Friday, April 11, 2025

U.S. stocks closed out the week on a strong note, finishing Friday higher and posting weekly gains thanks to the Wednesday’s historic market advance after President Trump delayed additional tariffs on trading partners (excluding China) for 90-days. Overnight, in its latest retaliation against U.S. tariffs, China said it would impose 125% duties on U.S. goods from Saturday, up from 84%, countering the US increased tariffs to 145% yesterday against Beijing. China did note they wouldn’t raise any further and announced some breaks for some semiconductors. Outside of the bounce in stocks, the bigger stories were the volatile moves in currency and Treasury markets this week as yields absolutely surged and the dollar tumbled on tariff impact/recession fears. In economic data, producer prices (PPI) came in well below expectations, showing continued cooling in inflation (after CPI yesterday). Markets are easing into earnings next week with mixed results from banks today, and a handful of names next week before the Easter holiday; then things ramp with earnings the week of April 21^st. For the week, the S&P 500 gained 5.7% (best since 11/23), the Nasdaq climbed 7.29% (best since 11/22), and the Dow climbed 4.95% (best since 11/23).

Stocks got an additional boost this afternoon after the Financial Times reported Boston Federal Reserve Bank President Susan Collins on Friday said the U.S. Central bank is “absolutely” prepared to deploy its tools to address financial market functioning if the need arises. Though “markets are continuing to function well” there aren’t any overall liquidity concerns, Collins said in an interview with the Financial Times, the Fed “does have tools to address concerns about market functioning or liquidity should they arise,” noting that the Fed has brought those tools to bear quickly in past instances. “We would absolutely be prepared to do that as needed.” These comments were the first this week by the Fed showing support of the market (stock/bond) given the recent spike in Treasury yields which hit highs of 4.59% this morning (thought fact that was mentioned also a bit scary).

• University of Michigan surveys of consumers sentiment prelim April fell to 50.8 from 57.0 in March and below consensus 54.5; the current conditions index prelim April 56.5 (consensus 61.5) vs final March 63.8; the expectations index prelim April 47.2 (consensus 50.8) vs final March 52.6
• University of Michigan surveys of consumers 1-year inflation outlook prelim April surged to 6.7% (highest since 1981) vs final March 5.0% while the University of Michigan surveys of consumers 5-year inflation outlook prelim April 4.4% vs final March 4.1%.

• Oil prices rebounded along with stocks as WTI crude gained $1.43 or 2.38% to settle at $61.50 per barrel while Brent advanced $1.43 or 2.26% to settle at $64.76 per barrel. Prices got a pop late afternoon as U.S. Energy Secretary Chris Wright said the United States could end Iran’s oil exports as part of an effort to bring the Islamic Republic to terms over its nuclear program. Prices were pressured mid-week against a backdrop of investor concern over the burgeoning trade war between the United States and China. Brent and WTI are poised to register weekly declines of about 3%, after having both lost about 11% last week.

• U.S. Treasuries slumped as yields surged for their biggest weekly jump since 2001. The 10-year yield rose 50bps to 4.492% this week (but off Monday lows 3.88%) and the 2-yr rose 27.8bps to 3.95% on the week. @MikeZaccardi said “30yr TIPS 2.85%…Highest in 23 years”. Treasury yields jumped on Friday, but finished off their highs after the Financial Times reported the Fed’s Susan Collins said the Federal Reserve ‘absolutely’ ready to help stabilize the market if needed. That helped ease Treasury yields, with the 10-yr pulling back off earlier highs of 4.59% (highest since 2/13).

• In Autos: STLA said global shipments fell 9% y/y in Q1 to an estimated 1.2M vehicles, it said on Friday, after a 12% drop in 2024; said the drop primarily reflected lower North American production; in the first three months of 2025, Stellantis’ shipments were down 20% in North America and 8% in its enlarged Europe area.
• In Homebuilders: RBC Capital said they remain in the homebuilder group (DHI, LEN, LBH, TOL) as sees meaningful NT downside risk on orders/margins/EPS. RBC’s March data saw a continuation of Feb.’s negative pricing trends. This is consistent with weaker recent demand/price/incentive trends/management. commentary from recent off-calendar reporters.

• In Aerospace: JOBY was downgraded from Overweight to Equal weight at Morgan Stanley as it contemplates the macro view of its Economics team which highlights recent policy on trade may weigh meaningfully on growth. Additionally, their Equity Strategy team has highlighted the risk of potential second-class order impacts of tariffs which may harm corporate confidence and lead to lower growth. The firm lowers tgts for HXL to $50 from $61; TXT to $71 from $82; AER to $101 from $112; JOBY to $7 from $10; CAE to C$36 from C$37; and FTAI to $138 from $168
• In Defense: Goldman Sachs double upgraded HII and LHX to Buy from Sell; upgraded NOC to Neutral from Sell and downgraded BAH and PL to Neutral from Buy as the firm assumes a less cautious view on Defense as the medium-term defense budget picture looks better notably that the administration is planning for a FY2026 DoD budget near $1.0 trillion which should drive a higher-than-expected growth rate. For LHX, it believes it could be well positioned in a higher defense spending environment, given its exposure to faster growing parts of the budget. U.S. Defense Secretary Pete Hegseth has ordered the termination of IT services contracts, totally valued at $5.1 billion, with companies such as ACN and Deloitte, a memo showed. "These terminations represent $5.1 billion in wasteful spending … and nearly $4 billion in estimated savings," Hegseth added.
• In Metals & Mining: gold miners extend weekly and YTD gains as the price of gold surges to new record highs in flight to safe havens for investors; AUY, GOLD, NEM, AEM, other miners strong all week; NEM was upgraded to Buy at UBS as view the macro backdrop for gold is incrementally more supportive and it upgrades gold price forecasts targeting $3,500/oz in 2026. AEM, AGI, AU, EGO, FSM, GNV, HMY, IAG, KGC, SANDand WPM among miners hitting 52-week highs today.
• In Industrials: TITN was upgraded to Outperform and CNH to Market Perform at Northland saying shares are trading at a level not seen since pre-Covid when Northland was approaching the bottom of the last farm-cycle. The company’s shares returned 118.0% in the two years for TITN and CNH 115.7% 2 years from pre-Covid low.

• JPM said Q1 profit rose 9%, helped by higher fees from dealmaking and a record performance in equities trading as EPS of $5.07 topped the $4.64 estimate and revs of $46B was above the $44.39B consensus; Q1 investment banking fees rose 12% to $2.27B while equity markets revenue surged 48% to a record of $3.8B; trading revenue climbed 21%, higher than the earlier expectations of a low double-digits percentage gain; raised FY25 net interest income view to ~$94.5B, above its prior view ~$94B
• WFC reported Q1 revs fell -3.4% y/y to $20.15B, missing the $20.72B est. due to weakness in consumer and commercial banking; Q1 consumer banking revenue slipped -2%, as auto and personal lending dropped, and commercial banking declined -7.2%, to offset a 1.6% rise in corporate and investment banking revenue; Q1 EPS of $1.39 topped the $1.23 est. as lower expenses helped offset a decline in net interest income (NII) which fell -6% y/y; said still sees FY NII growth about to +1% to +3%.
• BK posted Q1 adj EPS $1.58 vs. est. $1.50; Q1 net interest margin 1.3%, Net interest income (NII) rose 11% to $1.16B; total fee and other revenue rose 3% to $3.63B and Return on equity (ROE) 12.6%; BNY’s assets under custody and administration were $53.1 trillion in the first quarter, 9% higher than last year; Q1 revs rose 6% to $4.79B above estimates $4.76B.
• MS reported Q1 EPS of $2.60, topping the $2.19 estimate as revenues rose 17% y/y to a record $17.74B above the $16.55B consensus; Q1 profit increased 26% to $4.32B; Q1 Trading revenue surged, led by a 45% increase in equities; increased its 1Q provision for credit losses to $135M from a loss of $6M.
• In Asset managers: BLK Q1 investment advisory and administration fees, jumps 17% from last year in Q1; assets under management rise 10.6% from last year to $11.58 trillion, but flat from the previous quarter; Q1 net income of $1.51 billion, down from $1.57 billion a year earlier vs. est. $1.54 billion.
• Next week earnings from GS, SCHW, Citi, BAC and others.

• In Consumer Finance: AXP was upgraded from Neutral to Buy at Bank America while lowering its tgt to $274 from $325 saying the current downtick offers long-term oriented investors an opportunity to buy a high-quality company at a reasonable valuation (notes macro env’t is uncertain and GDP growth is likely slowing).
• In Insurance: Jefferies said tariffs are a manageable earnings risk for the well-capitalized and defensive P&C group. Auto insurers have some ability to re-price quickly, and loss cost inflation concerns are already top of mind for the commercial group, with any tariff impact likely to spur further discipline. Jefferis said has most EPS upside on ROOT, TRV, and ACGL remains most constructive on Personal Lines, upgraded EG and cut SKWD

• ARGX received FDA approval for the syringe version of its Vyvgart drug; the pre-filled syringe (PFS) will be self-admin permitted with no specific training nor monitoring required.
• NVAX late yesterday provided an update on the status of their COVID-19 vaccine BLA. The company has not yet received an official response from the FDA regarding the status of the BLA.
• NVS said yesterday it will spend $23 billion to build and expand 10 facilities across the U.S. as part of a broader $50 billion push to localize drug production amid President Trump’s looming tariffs.
• SRPT was initiated at Overweight and $115 tgt at Wells Fargo saying despite the recent Gr5 AE case, thinks ELEVIDYS remains the best option for most young DMD pts, and thus the commercial oppty is largely intact and believes the recent weakness is a buying opportunity based on value of commercial DMD franchise.
• VERV receives US FDA fast track designation for Verve-102, an in vivo base editing medicine targeting PCSK9.