Early-week gains fell victim to more macro pressures
Just when stocks seemed ready to rally this week, tariff uncertainty and economic concerns crept back in. The Dow Jones Industrial Average (DJI), S&P 500 Index (SPX), and Nasdaq Composite (IXIC) moved in tandem all week: Outsized gains on Monday and Tuesday, followed by red ink the rest of the way, with hotter-than-expected inflation data the nail in the coffin on Friday. Though the benchmarks were on track for weekly wins coming into Friday, a sharp broad market selloff -- with the Dow nursing an over 600-point midday deficit -- have sent all three major indexes into the red for the week.
Sectors to Watch
The auto sector was front and center amid auto tariffs, with Ford (F) and General Motors (GM) feeling the heat. Tesla's (TSLA) slide has been drawing attention, but two other electric vehicle (EV) stocks made moves this week as well.
Defense stocks were in the spotlight on Monday after President Donald Trump awarded Boeing Co (BA) a contract to build the U.S. Air Force's latest fighter jet, and Lockheed Martin (LMT) drew bear notes after the news. Meanwhile, embattled solar stocks saw a notable rebound on Tuesday despite Canadian Solar's (CSIQ) earnings miss, and we pointed out three cloud-based stocks to watch amid tech volatility.
M&A Madness
Outdoor living stock Azek Company (AZEK) soared after news that James Hardie Industries (JHX) will acquire the company for nearly $9 billion. UniFirst (UNF) stock crumbled after Cintas (CTAS) terminated its billion-dollar buyout offer. Dollar Tree (DLTR) announced that it was selling Family Dollar for $1 billion. And in related news, GameStop (GME) plans to use corporate dollars to buy Bitcoin (BTC), and Rocket Lab (RKLB) was awarded a national security contract.
The Week Ahead
April kicks off with a flood of economic data next week, including several rounds of employment reports. Schaeffer's Senior V.P. of Research Todd Salamone has the key SPX trendlines to watch going forward.
Interestingly, bearish sentiment has overtaken the bulls. Could it be a contrarian buy signal? Senior Quantitative Analyst Rocky White shines a light on it with historical data.