Trump Tariff Spat Has Stock Dip Buyers Obsessed With Wednesdays

The stock market has been on a rollercoaster ride this week, with investors keeping a close eye on President Trump's tariff announcements and their potential impact on the economy. On Monday, Trump announced new tariffs on Canada, Mexico, and China, sending stocks tumbling. However, the losses moderated after Trump delayed the Mexican tariffs for one month, and Canadian and Chinese tariffs are scheduled to go into effect just after midnight on Tuesday morning.



Goldman Sachs analysts modeled out how the tariffs could impact U.S. markets and estimated that the levies may reduce the S&P 500’s fair value by roughly 5%. They explained that tariffs will either shrink U.S. profit margins by raising input costs or, if higher costs are passed on to consumers, slow sales. "We estimate that every 5pp increase in the US tariff rate would reduce S&P 500 EPS by roughly 1-2%. As a result, if sustained, the tariffs announced this weekend would reduce our S&P 500 EPS forecasts by roughly 2-3%," the analysts wrote in a note released Sunday.



Marko Kolanovic, former chief strategist at JPMorgan, voiced concern that high market concentration, stock valuations, and political turmoil set the stage for a market correction this year. In a podcast appearance recorded last week, he said, "I think there's some probability of that." Kolanovic on Sunday addressed Trump’s tariffs and the impact they could have on the market. “Trade war puts us in 2018 environment (higher volatility, lower valuations). Those who point (out) that Trump cares about stock market, should remember that even then he did not react until ~5% decline. Tolerance for declines could be higher now, and markets are at highs,” he wrote in a post to X.

As investors await further developments in the trade war, they are keeping a close eye on Wednesdays, as that is typically the day when the U.S. government releases its weekly jobless claims data. This data can provide insight into the health of the labor market and the overall economy, which can in turn impact stock prices. Additionally, investors are watching for any signs of progress in the trade negotiations between the U.S. and its trading partners.

In conclusion, the stock market has been volatile this week as investors react to President Trump's tariff announcements. While the losses have moderated after Trump delayed the Mexican tariffs, investors are still concerned about the potential impact of the tariffs on the economy. As the trade war continues to unfold, investors are keeping a close eye on Wednesdays, as that is typically the day when the U.S. government releases its weekly jobless claims data. This data can provide insight into the health of the labor market and the overall economy, which can in turn impact stock prices.