Closing Recap

Monday, April 21, 2025

U.S. stocks bled lower most of the trading day, with no notable bounces until the final 60 minutes, paring losses but still ended down sharply as investors remain leery about tariffs, trade deals, the economy, and the Fed, as President Trump renewed his attacks against Federal Reserve Chair Jerome Powell. Sentiment remains bleak as evident by recent AAII weekly polls and NAAIM data with lots of confusion in markets ahead of a busy earnings week (nearly 120 S&P 500 companies report this week including TSLA and GOOGL). Investors are concerned about company guidance given the trade barriers and tariff impacts that are difficult to quantify at this time. Stocks continue to bleed lower, bond markets are falling as yields rise (ending near the high), while the US dollar is getting crushed, which means the cost of imported goods is going higher on top of whatever the tariffs will apply. A tough situation for the White House, while the Fed seems content on seeing how things play out vs cutting rates or easing. So far, there have been trade talks with a few countries the last few weeks, including Japan late last week, but the lack of publicly announced deal progress is depressing the U.S. dollar, spiking bond yields and leading to a flight to safety to gold (making all-time highs above $3,400 today) and now Bitcoin with its move today.

White House economic adviser Kevin Hassett said on Friday that Trump and his team would study whether firing Fed chairman Powell was an option, a day after Trump’s comments that Powell’s “termination cannot come fast enough”. That was followed up by harsher words this morning from Trump saying on Truth Social; “Preemptive Cuts” in Interest Rates are being called for by many. With Energy Costs way down, food prices (including Biden’s egg disaster!) substantially lower, and most other “things” trending down, there is virtually No Inflation. With these costs trending so nicely downward, just what I predicted they would do, there can almost be no inflation, but there can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW. Europe has already “lowered” seven times. Powell has always been “To Late,” except when it came to the Election period when he lowered in order to help Sleepy Joe Biden, later Kamala, get elected. How did that work out?”

• WTI crude oil prices retreated, falling -$1.60 or 2.47% to settle at $63.08 per barrel as traders remain concerned over the impact of the US-led trade war on energy demand, while signs of progress in talks between Washington and Tehran eased concerns about supplies from Iran. U.S. natural gas futures continue losses, prices down by 5% to 11-week low on record output, forecasts for mild weather and low demand.
• The US dollar hit over a three-year low, making greenback-priced bullion cheaper for overseas buyers. Meanwhile, China warned countries against striking a broader economic deal with the U.S. at its expense. Longer-dated U.S. Treasury yields rose as investors watched the escalating Trump administration attacks on Fed Chair Powell. The yield on the benchmark U.S. 10-year Treasury note was up about 8pbs late day at highs above 4.41%.

• In Retailers: AMZN downgraded to Outperform from Strong Buy at Raymond James (tgt cut to $195 from $275) saying the Street is underestimating EBIT pressures in 2025-26. Reports indicated President Trump to meet with WMT, TGT, HD and LOW executives as tariff angst spreads.

• In Chemicals: LYB and DOW both added as catalyst call Buys into earnings at Deutsche Bank saying the upcoming Q1 earnings release will be a clearing event and catalyst for the shares. Scotia said that CF is a relative winner in fertilizer sector after last week, the U.S. Administration announced its intention to proceed with fees for Chinese built ships that dock at U.S. ports. Over time, total levies could be as much as $1.5M per ship, depending on a detailed fee table.
• Utility (CEG, OKLO, VST) and Data center (VRT, DELL, SMCI) related names tumbled today after Wells Fargo noted according to their industry sources, AMZN AWS has paused a portion of its leasing discussions on the colocation side. The firm said its not clear as to the magnitude of the pause, but says positioning is similar to what they heard from $MSFT and are digesting aggressive recent lease up deals. Meanwhile, TD Cowen noted their checks indicate ~1.9GW of 1Q25 hyperscale leasing led by ORCL and AMZN, followed by CRWV and GOOG, although industry sentiment around hyperscale demand has moderated as AMZN pulls back slightly (tied to U.S. colo deals). 1Q25 enterprise leasing was strong, up both Q/Q and Y/Y. Importantly, our checks indicate material MSFT equipment order cancellations for long-lead time DC equipment.
• In Metals & Mining: Gold and silver miners seeing the biggest gains as RGLD, AEM, EGO, FNV, KGC, SAND, WPM among precious metal miners hitting 52-week highs as gold surged more than 3%.
• In Aerospace & Defense: sector in focus with earnings tomorrow from LMT, NOC, RTX.

• In Payments: GPN was downgraded to Hold from Buy at TD Cowen and FIS upgraded to Buy from Hold after the company entered into a definitive agreement to acquire GPN’s Issuer Solutions business for an enterprise value of $13.5B. FIS has entered into an agreement to sell its stake in Worldpay to Global Payments for $6.6B in pre-tax value. GPN downgraded to Hold at Jefferies after Worldpay acquisition and cut its tgt to $75 from $100 saying it is clear that scale-driven deals in merchant acquiring are unlikely to work, says the firm
• In Crypto: Bitcoin prices rose; MSTR said it sold 1.755M shares for $547.7M from April 14-20 as per SEC filing and acquires 6,556 Bitcoin for $555.8M; Bitcoin prices outperformed despite weaker stock markets all day, rising over 3.8% above $88,300 and boosting crypto miner stocks.

• Hospital operators (UHS, HCA, THC) were broadly weaker; the WSJ this weekend noted Hospital Chains’ Medicaid profits are a juicy target for GOP budget hawks; article noted Republicans looking for cost savings could sink profits at Universal Health Services, others.
• IMVT announced its next phase of growth with ROIV including changes to its leadership team and additional indications Sjögren’s Disease and Cutaneous Lupus Erythematosus (CLE) for IMVT-1402
• NTLA upgraded to Outperform from Peer Perform at Wolfe Research with a $21 price target
• PCRX authorizes a $300M share repurchase program.
• REGN and SNY said the U.S. FDA has approved Dupixent for the treatment of adults and adolescents aged 12 years and older with chronic spontaneous urticaria who remain symptomatic despite histamine-1 antihistamine treatment.
• TEM was initiated with a Buy at BTIG with price tgt $60 saying Tempus AI is a rapidly growing precision medicine platform technology company, which has "done a good job in its early days" to monetize its genomics and data business to medical oncologists and with pharma companies.

• In Semiconductors: NVDA shares declined after Reuters reported Huawei Technologies plans to begin mass shipments of its advanced 910C artificial intelligence chip to Chinese customers as early as next month, two people familiar with the matter said; some shipments have already been made, they added. In Semi-equipment: AMKR was downgraded to Neutral at B Riley and they cut ACLS to Neutral from Buy (tgt to $50 from $80) ahead of earnings as expects in-line Q125 results and Q225 guidance aided by Q424’s $645M backlog. Yet, on now-elevated capacity spending risk, cut 2H25 and 2026 ests and fear China tariff COGS risk.
• In Software: CRM was upgraded to Neutral from Sell at Guggenheim this morning while DA Davidson downgraded to Underperform from Neutral (PT cut to $200 from $250).