👊 Fool me twice shame on you

and the deepening rout

Good morning investors! The market played with investors yesterday as fear continues to rule.

Six Republican Senators, including Sen. Mitch McConnell, endorsed a proposed Trade Review Act that would allow Congress to oversee trade measures. The White House, however, has stated it would veto the legislation.

Today we cover:

  • The rally reversal

  • Earnings start (Walgreens)

  • Healthcare and insurance stocks surge

What are you expecting from this earnings season?

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📊 Economy and News 

Wall Street’s Wild Rally Reverses as Tariff Shock Hits Markets

A powerful early rally on Wall Street crumbled into a steep decline Tuesday after the White House confirmed sweeping new tariffs on Chinese imports. Press Secretary Karoline Leavitt announced that all Chinese goods would face tariffs of at least 104%, with an additional 84% in levies taking effect Wednesday.

The S&P ended the day at its lowest level in nearly a year, with the Nasdaq and Dow at their weakest since January.

Earlier in the day, optimism had driven the S&P and Nasdaq up more than 4% and 4.5% respectively, and the Dow nearly 3.9%, fueled by hopes for a breakthrough in trade talks. But those gains evaporated as the tariff announcement triggered a sharp sell-off.

The S&P flirted with bear market territory for the second day in a row, closing 18.9% below its February peak, while the Nasdaq remains deeply in bear territory, now off 24.3% from its December high.

Investors had been grasping for signs of progress on trade. A temporary spike Monday was driven by false rumors of a tariff pause, proving how sensitive markets are to any hint of easing tensions. Even vague mentions of potential negotiations with allies like Japan and South Korea were enough to momentarily lift sentiment.

Still, uncertainty remains dominant. The VIX fear index surged again with some calling it a bullish indicator. However, some fear that this aggressive tariff approach could tip the global economy into recession.

While some White House officials, like Peter Navarro, remain bullish — predicting a roaring comeback and a Dow at 50,000 — others in the financial world aren’t convinced. JPMorgan CEO Jamie Dimon cautioned that tariffs could damage global alliances and slow economic growth, a sentiment shared by several notable investors.

Global hits:

Peter Navarro, a longtime Trump trade advisor, claimed that 70 countries are set to negotiate with Trump, and 0% tariffs won't suffice for most. He argued the U.S. deserves reparations for importing more from countries like Vietnam than they buy from the U.S.

Look here: Mortgage rates hit their highest level in over a month this week, reversing course after a period of improvement. The average rate on the 30-year fixed rate jumped 22 basis points Monday and another 3 basis points Tuesday to 6.85%.

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  • Read disclosures at the end of the newsletter

📈 Stocks

S&P 500 4 982,77 (-1.57%)
DJIA 37 645,59 (-0.84%)
NASDAQ 15 267,91 (-2.15%)
BRENT CRUDE 60.72 (-3.34%)
* Prices as of Apr 9th, 12:20 AM UTC

Walgreens Beats Earnings Expectations Ahead of Take-Private Deal

Walgreens reported better-than-expected fiscal second-quarter earnings and revenue, buoyed by cost-cutting efforts and gains from health-care investments. The company is in the process of going private through a $10 billion deal with Sycamore Partners, expected to close in the fourth quarter. As a result, Walgreens withdrew its 2025 guidance.

For the quarter ending Feb. 28, Walgreens posted adjusted earnings of 63 cents per share (vs. 53 cents expected) on $38.59 billion in revenue (vs. $38 billion expected). Despite this, it recorded a net loss of $2.85 billion, primarily due to a $4.2 billion impairment tied to its retail pharmacy and VillageMD investment.

Sales rose 4.1% year-over-year, helped by growth in U.S. and international retail pharmacy segments. Walgreens also reported a $1 billion profit from selling Cencora shares and gains from BrightSpring.

Shares rose nearly 2% in premarket trading but eventually closed lower. CEO Tim Wentworth noted that the turnaround plan is still in early stages and will require sustained investment amid evolving industry challenges.

Check this: Apple’s 4-day slide puts Microsoft back on top as most valuable company. Elsewhere, GM is axing Cadillac XT6 crossover, extending production of another vehicle in Tennessee. Lastly, Stellantis is no longer producing its Chinese partner Leapmotor's T03 small electric car at its Tychy plant in Poland.

 Some light: Healthcare and insurance stocks surged over 5% on the S&P 500 after the Trump administration announced the Fed would pay higher rates to insurers next year, potentially generating $25 billion. The new 5% rate is nearly double Biden’s. Humana (+11%), CVS Health (+6%), and UnitedHealth (+5%) were the top performers, outpacing Lockheed Martin (+3%) after Trump pushed for a $1 trillion defense budget.

Mehmet Oz, the newly appointed head of the Fed Medicare Advantage program, has expressed support for private insurance in Medicare but also criticized the program for overcharging Americans. Last summer, the Wall Street Journal revealed that Medicare Advantage faced scrutiny for allegedly spending $50 billion on unverified medication treatments.

💵 Personal Finance

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💰 Be a Better Investor

"Nothing in life is to be feared, it is only to be understood. Now is the time to understand more, so that we may fear less

Marie Curie

Resources:

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👩🏽‍⚖️ Legal Stuff
Nothing in this newsletter is financial advice. Always do your own research and think for yourself.

Disclosures

1 Mode Mobile recently received their ticker reservation with Nasdaq ($MODE), indicating an intent to IPO in the next 24 months. An intent to IPO is no guarantee that an actual IPO will occur.

2 The rankings are based on submitted applications and public company database research, with winners selected based on their fiscal-year revenue growth percentage over a three-year period.

3 A minimum investment of $1,950 is required to receive bonus shares. 100% bonus shares are offered on investments of $9,950+.

Please read the offering circular and related risks at invest.modemobile.com. This is a paid advertisement for Mode Mobile’s Regulation A+ Offering.