Futures Jump On Report Trump Reciprocal Tariffs To Be "More Targeted" Than Feared

A Bloomberg article dropped yesterday and it suggests that the new tariffs on April 2 are poised to be more targeted than originally feared; this is helping spark a risk on move across global markets, and push US futures about 0.7% higher late on Sunday. 

According to the report, "Trump is preparing a “Liberation Day” tariff announcement on April 2, unveiling so-called reciprocal tariffs he sees as retribution for tariffs and other barriers from other countries, including longtime US allies. While the announcement would remain a very significant expansion of US tariffs, it’s shaping up as more focused than the sprawling, fully global effort Trump has otherwise mused about, officials familiar with the matter say.

Trump will announce widespread reciprocal tariffs on nations or blocs but is set to exclude some, and — as of now — the administration is not planning separate, sectoral-specific tariffs to be unveiled at the same event, as Trump had once teased, officials said."

So while we wait for more color about what Trump will unveil on Liberation Day, below we share the latest thoughts from Goldman trader John Flood on where we stand right now:

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S&P clawed back 51bps last week for its first positive week since Valentine’s Day. After listening to Jay Powell on Wednesday I got the sense that the Fed Put is creeping back into the market. It is worth noting that we ended last week with Thursday (3/20) as the lightest trading volume session of the year (13.1b shares traded across all US exchanges) followed by Friday (3/21) as the highest (21.03b shares as a result of triple-witch). Friday’s MOC of +$8.1b to buy was outsized and hints at footprints of CTAs (short covers) and Pensions (+$30b Q end rebal getting started early).

I am watching for the S&P 500 to trend towards its 200dma of 5750 this week. It will be difficult to break significantly higher from the 200dma until we see longer duration investors step in as buyers (which is unlikely to happen before 4/2). Looking at aggregated 1-delta flow executed across our franchise last week the Long Only community finished with a net sell skew of -430bps (80th percentile of last 1 yr....AKA still not buyers).

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