00:00Well, for more markets reaction to U.S. tariffs, let's speak to Matt Smiley, Chief Market Strategist, Asmila Tava & Co.
00:07So, Matt, great to have you on the show. It is a new week after the shock of the August 1st tariff deadline.
00:13How would you describe the latest markets movement?
00:17Well, it's interesting that the markets are bouncing back here in the U.S. this morning, you know, kind of a knee-jerk reaction
00:23because, of course, the market has bounced back every single time you've had any little dip, you know, since April.
00:29And so, you know, it's kind of like Pavlov's dog where they just come in and automatically start buying.
00:35But it's going to be interesting to see if it really holds because last week the market, you know,
00:39didn't really respond particularly well overall to some of the positive earnings reports out of several MAG-7 names.
00:47And, of course, it reacted quite poorly to the news on tariffs and on the employment report.
00:54So, you know, we're not getting the bad news is good news situation anymore.
00:58So, I'm just looking at the market now. Yeah, you know, if it can hold here, that's going to be key.
01:02But if we roll back over because some of these concerns from last week resurfaced, that's going to be, you know,
01:08tough because we're heading into that seasonally tough time frame of August to October for the stock market.
01:13So, we have seen Swiss stocks fall in light of the 39% tariffs.
01:18Who else is among the worst hits by the latest U.S. trade policies?
01:21You know, this is going to be really interesting to see how it unfolds this week because, you know,
01:27a part of the thing that President Trump hates is this taco tag.
01:30I mean, they're saying that Trump always chickens out.
01:34So, now with the stock market, you know, at all-time highs and he already got his big, beautiful bill passed,
01:41he's got a lot of reasons to think the market will do very – he's got a lot of reasons to hold tough right now.
01:48So, the question is, you know, Switzerland has made a lot of good moves to try to encourage some further talks.
01:56So, if they can get this thing extended a little bit, I think they'll be able to come to an agreement.
02:01But if it's something where the U.S. stands tough for this Thursday deadline,
02:07that's going to be – have a real impact on not just Switzerland's market, but I think for some global markets.
02:12We're having to say, Matt, that Donald Trump didn't chicken out in firing people
02:16and how much of a shock was Donald Trump firing the lead official on Labor data
02:20after he claimed last week's job report was rigged.
02:25Yeah, this was a big surprise for me, certainly, and I think for a lot of people.
02:30I don't think it bodes particularly well for confidence right now.
02:33I mean, even for those who are the biggest supporters for Donald Trump, it just – you know,
02:38if you don't like a number and you just fire the person, that doesn't look very good.
02:42And so, you know, even though the market's bouncing back today,
02:46we have a lot of issues here with confidence in the whole system with his, you know,
02:52his criticisms of Chairman Powell when it comes to the Fed, and now we have this with the BLS.
02:59You know, if he's just firing people he doesn't like, they're not doing exactly what he wants to do,
03:04that's not something that leads to a lot of confidence in the market or in the economy.
03:09So if this is something that continues, I think today's bounce back is going to be one that is going to be hard to hold.
03:16Well, Matt, this is the earnings season.
03:17Looking ahead to the rest of the week, what announcements or earnings reports should we be looking out for?
03:23Well, tonight we have Palantir, which has, of course, been, you know, one of the best stocks in the stock market this year.
03:30They're reporting earnings.
03:31Then we have Advanced Micro Devices tomorrow, you know, a key chip name.
03:35So we'll see how the market reacts to it.
03:37I mean, both of these stocks have had great runs.
03:39So if they see a further rally, that's going to be positive.
03:42But the one thing, again, I worry about is that we had some positive reports last week out of Meta, Apple, and Microsoft.
03:48And although those stocks rallied, it didn't help the rest of the market rally.
03:51And, you know, earnings estimates have not moved up much at all this year.
03:55And with the stock market trading at 22 times earnings, we're going to need those estimates to increase quite a bit.
04:01So this is going to be a very important week for the stock market to see how they react to these earnings reports.
04:06Thanks very much for your insights.
04:07That is Matt Milley, Chief Market Strategist at Miller, TopUp & Co.
Comments