| Dear Fellow Trader: |
| That was fast. |
| The S&P 500 just pulled off the fastest rebound in 40+ years, according to BeSpoke. |
| That erased 2025 losses quicker than you can say “transitory inflation.” |
| After face-planting to an April 7 low, the index has rocketed up 22% in what has to be the most dramatic mood swing on Wall Street since someone invented free Black Car rides home after 9 pm at Goldman Sachs. |
| We’ll talk today about how we traded and followed it since the selloff started in February. I’ll be live for today’s Market Masters at 8:45 ET. Join me live at this link. |
From “The Sky is Falling” to “Nevermind!”
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| Remember when all those economists were absolutely positive we were headed for economic disaster? |
| A 90-day tariff timeout changed everything. |
| Wall Street’s finest are now tripping over themselves to walk back recession calls faster than politicians backpedal during election season. |
| JPMorgan’s Michael Feroli, who predicted a recession not too long ago, now says: “The administration’s recent dialing down of some of the more draconian tariffs placed on China should reduce the risk that the US economy slips into recession this year.” |
| This is a little secret on Wall Street… one that I’ll explain. |
| Everyone wants to be the first to predict something. |
| Here’s the economics-for-dummies version: |
| Tariffs = stealth taxes. |
| By cutting the effective tariff rate from 24% to 14%, we’ve basically given American consumers a $300 billion “tax cut.” |
| Who knew international trade policy could this easy? |
| Goldman Sachs (never one to miss a bandwagon) slashed its recession odds from 45% to 35%, while doubling its GDP growth forecast to a whopping 1%. |
| Barclays abandoned its recession call, presumably burning the evidence that they ever made it. |
| Meanwhile, Yardeni Research is feeling so bullish they’re forecasting 2025 GDP between 1.5% and 2.5%. |
| Those are some wild numbers, fellas… |
Stocks Say “Thank You Very Much”
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| Stock futures took a breather Wednesday after Nvidia and its AI besties powered Tuesday’s tech rally. |
| Turns out inflation is behaving itself too, growing at the slowest pace since 2021 despite all the trade drama. |
| In the “putting their money where their mouth is” department, Yardeni Research jacked up its S&P 500 target from 6,000 to 6,500. |
| Goldman’s crystal ball now shows 6,100 by year-end, up from 5,900. |
| Even the gamblers on Polymarket are feeling bullish. Recession odds dropped from 51% to under 40%. |
Not Everyone Got the Memo
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| Despite the champagne popping on Wall Street, some party poopers remain. |
| Foxconn (who make the iPhone components and Nvidia’s AI servers) just downgraded their outlook, specifically blaming tariff chaos. |
| Foxconn Chairman Young Liu warned, “Over the past month, rapid changes in U.S. tariff policies have considerably impacted the global supply chain.” |
| Of course, this 90-day truce is about as permanent as a Hollywood marriage. |
| We still need an actual trade deal, and those higher overall tariffs could hit markets hard. |
| But why worry about tomorrow when stocks are up today? |
Trading With Don and Me
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| I’ll be live at 8:45 ET for our full trading session. Then, I’ll join Don Kaufman at 9:20 to open the market and look for his top trades of the day. All are invited, but you have to join me… |
| Right here… |
| In the room… |
| I’ll see you in 30 minutes. |
| Stay positive, |
| Garrett Baldwin |
