During the week, algorithms and headlines danced like flamingos together as stock portfolios made a swan dive. Interestingly, anytime the market gained traction, President Trump mentioned “tariffs,” indicating there was no ‘Trump Put.’ Bringing back manufacturing to America is more significant than short-term stock market moves.

There was a slight reprieve on Friday, but it felt like a much larger win.

But there was a cautious tone to the session, led by Utilities (XLU) and Energy (XLE), while momentum struggled.

Trump Clarifies Vision and Timeline

“There could be a little disruption. You can't really watch the stock market. If you look at China, they have a 100-year perspective… we go by quarters. What we’re doing is building a foundation for the future.”

-President Donald Trump

President Trump said on Sunday with Fox’s host Maria Bartiromo what I have been saying for months that the American public has to reject Wall Street’s short-termism and the notion that the stock market is a day-to-day gauge for everything.

In fact, I have argued that we should adopt the page from China’s playbook that so many in the United States openly admire: longer-term patience with a long-term game plan.

Broken Gauges

Over time, the market realigns with the economy, but it has lost much of its predictive abilities because of too many gimmicks and the financialization of the market.

Remember when the inverted yield curve was the gold standard for predicting recessions? Not anymore.

Keep in mind that the Leading Economic Indicator was a foolproof tool for predicting a recession.

However, I do not see a recession, but the consumer is hurting. If the markets continue to struggle, the top 10% will stop spending and feel like the bottom suddenly drops out.

I appreciate the confident tone of the Commander-in-chief.

Market selling is overdone, and the numbers do not add up. The market should not be down this much for the potential impact of tariffs. 

Ironically, those who thought that laying it on thick and screaming about tariffs would force Trump to change his mind may have done a disservice to themselves and the stock market.

Today’s Session

The contrarian indicators on the market being oversold continue to mount, including the spike in put buying.

Technical View

This is the area that must be held. The 200-day can be violated on a closing basis, but not for many days. This is the near-term support point; we need to see glimpses of resolve this week.

Comments

The early, negative GDP forecast used by the Atlanta Fed seems to be used to push a narrative on the Trump administration and the direction of the economy. Is there a reason, other than the obvious, why no one mentions forecasts by New York, St. Louis, and Cleveland districts that are at +2.7, +2.5, and +2.5, respectively? I suppose time will tell, but I expect memories will be short. Brett Gore on 3/10/2025 10:41:16 AM

There are those that would love nothing more than a recession to be declared under the Trump Administration which would be that parroted talking point for most of the Media. Love your guidance Charles, Patience and Planning over a longer return. P. Krueger on 3/10/2025 11:19:48 AM

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