🪔 What to expect this week

and Trump speaks

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Good morning investors! This was a busy weekend with major economy-related news and a big Trump interview.

Today we cover:

  • Don’t worry about the GDP

  • Trump speaks

  • What to expect this week

Apple has shown consistent movement on certain dates over the years—do you know when? Stock Hotsheets reveal historically significant patterns for top stocks like Walmart and LULU.

📊 Economy and News 

U.S. Economy Poised for Explosive Growth Despite GDP Dip

Negative GDP for Q1 2025, the first decline since 2022, might not be bad news after all. Let’s focus on the positive – the headline figure masks a robust economic surge driven by private sector investment.

A 41% spike in imports, front-running anticipated tariffs, skewed the GDP calculation, which counts imports as a negative. Excluding this, GDP grew at an impressive 4.5%.

Consumer spending outpaced government expenditure by 3.2%, the strongest since 2022, while government spending fell for the first time in three years. Adjusted for this, economic growth neared 5%.

Private investment soared 22%, fueled partly by tariffs encouraging foreign and domestic firms to relocate production to the U.S.

Announced investments have hit $5 trillion, with estimates from President Trump suggesting $8 trillion.

Major players like Taiwan Semiconductor ($165 billion), Softbank ($100 billion), Apple ($500 billion), and Middle Eastern firms ($2 trillion) are driving this re-industrialization. For context, pre-COVID gross private investment was $4 trillion annually.

Consumer spending rose 0.7% monthly, equating to a 9% annualized rate, defying pessimistic surveys. Inflation remained flat for the second time in Trump’s first three months, a rare economic sweet spot.

Looking ahead, the import surge is expected to translate into consumption or investment next quarter, boosting GDP. Continued deregulation and tax cuts could accelerate this trend. So, after all, we have some good news coming.

Global hits:

Trump talked: In a forward-looking interview with NBC News' "Meet the Press" at Mar-a-Lago, President Donald Trump expressed confidence in his economic policies and leadership.

He highlighted the recent implementation of tariffs, predicting they will boost the economy and make the U.S. a "very rich country."

Trump emphasized that businesses are already benefiting and suggested Americans can thrive with fewer non-essential goods, focusing on more critical priorities like affordable gasoline.

He took responsibility for his administration’s early days, noting a smooth transition despite only being in office for three months.

Trump also reaffirmed his commitment to serving two terms as an eight-year president, respecting constitutional limits, and outlined his ambitious plans for efficient immigration policies, prioritizing national security and economic growth.

Lastly, Trump said he won’t remove Fed chair Powell before term ends in 2026.

Busy Week Ahead for Markets with Fed Decision and Earnings

This week, investors await the Federal Reserve’s interest rate decision on Wednesday, with rates expected to hold at 4.25%-4.5% despite political pressure to cut.

Fed Chair Jerome Powell’s remarks will follow, amid recent positive inflation and jobs data.

Key economic reports include consumer credit, U.S. trade balance, and jobless claims.

Earnings from major firms like Palantir, AMD, Uber, Disney, and Ford will shed light on AI, semiconductors, and consumer trends.

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📈 Stocks

S&P 500 5,686.67 (+1.47%)
DJIA 41,317.43 (+1.39%)
NASDAQ 17,977.73 (+1.51%)
BRENT CRUDE 61.29 (-1.35%)
* Prices as of May 5th, 12:20 AM UTC

Wall Street Creates New Records with Strong Gains and Easing Recession Worries

Stocks wrapped up last week on a high note, with Friday’s session delivering strong gains across the board after April’s nonfarm payrolls report came in better than expected. The data helped ease recession fears and powered the S&P 500 to its longest winning streak in over two decades, setting a bullish tone for the start of the new week.

The S&P 500 climbed 1.47% to close at 5,686.67, marking its ninth straight day of gains—the longest run since November 2004. The Dow Jones Industrial Average surged 564.47 points, or 1.39%, ending the day at 41,317.43. Meanwhile, the Nasdaq Composite gained 1.51% to finish at 17,977.73.

Friday’s rally helped the S&P 500 recover all of the ground it had lost since early April, when President Donald Trump announced his “reciprocal” tariffs. The Nasdaq, which already bounced back earlier in the week, continued to strengthen alongside the broader market.

April’s jobs report showed payrolls growing by 177,000, beating economists’ expectations of 133,000, even though the number was down from March’s 228,000. The unemployment rate held steady at 4.2%, in line with forecasts. The upside surprise helped calm nerves that had been rattled by rising recession chatter in recent weeks.

Investor sentiment had already improved earlier in the day after China signaled it might be open to restarting trade negotiations with the U.S. However, Beijing also reiterated that any talks would require the U.S. to remove all unilateral tariffs. A Wall Street Journal report later in the day confirmed that Chinese officials are considering re-engagement.

Markets have staged a strong rebound since President Trump said he would temporarily reduce new tariffs for most countries to 10% for 90 days. That announcement, along with stronger-than-expected earnings from major companies, has fueled recent gains and contributed to the S&P 500’s ongoing rally.

All three major indexes ended the week solidly in the green, notching their second consecutive week of gains. The S&P 500 rose 2.9%, cutting its losses to just over 7% below its February peak after being down nearly 20%. The Dow advanced 3%, while the Nasdaq posted a 3.4% weekly gain.

Buffett Signals a New Era at Berkshire Hathaway

We know that Warren Buffett revealed plans to step down as CEO, but that’s not the only takeaway. Here are a few things you need to know:

Views on Trade: No Fan of Tariffs

Buffett strongly criticized tariffs, calling them harmful and even likening them to acts of war. He emphasized the importance of global trade and prosperity, arguing that growth abroad ultimately benefits the U.S. He stopped short of naming any political figures but clearly pushed back on protectionist policies.

Market Volatility: Business as Usual

Despite recent market swings driven by trade tensions, Buffett downplayed the impact, calling it a minor event. He welcomed the idea of a 50% drop in Berkshire’s stock as a potential buying opportunity, showing his long-term confidence.

Faith in America: Unshaken Optimism

Buffett reaffirmed his belief in U.S. resilience, pointing to its recovery from wars and recessions. He expressed deep gratitude for being born in America, calling it the “luckiest day” of his life and saying he’d still choose the U.S. above all.

Concern Over Debt: Unsustainable Path

Buffett raised alarms over the U.S. fiscal deficit, calling current levels unsustainable in the long term. While not directly addressing government efficiency programs, he stressed the need for smarter spending and stronger fiscal discipline.

Cash Reserves: Big Deal Almost Happened

Buffett revealed that Berkshire nearly invested $10 billion recently, though the deal fell through. He noted the company is ready to spend far more—up to $100 billion—if the right opportunity arises. As of the last quarter, Berkshire holds over $330 billion in cash.

Also check: Berkshire Hathaway operating earnings drop more than expected as Buffett warns of tariff uncertainty. Also, Trump says he would extend TikTok deadline if no deal reached by June 19.

💵 Personal Finance

How to be a day trader - Part VI

Let’s resume this week’s topic and cover more about day trading;

Risks of Day Trading

Financial Losses

Day trading carries a high risk of financial loss, especially for those using leverage to amplify trades. Borrowing funds can magnify profits but also escalates losses. A single poorly timed trade can deplete a trader’s capital, particularly for beginners who lack experience in volatile markets. Unlike long-term investing, day trading hinges on precise timing, where even minor price swings can lead to significant losses in minutes.

Market Volatility

Market unpredictability poses a major challenge. Prices can fluctuate rapidly due to economic reports, geopolitical events, or sudden news. Day traders, reliant on short-term price movements, are exposed to these abrupt shifts. Without a solid strategy or risk management, they risk being caught off-guard, turning potential gains into steep losses.

Emotional and Psychological Stress

The intense pace of day trading fosters emotional strain. Constant decision-making under time pressure can lead to anxiety, impulsiveness, or panic. Fear of missing out or desperation to recover losses often drives irrational trades, worsening financial outcomes. Over time, this stress can erode mental health and impair judgment.

Liquidity Risks

Low trading volume in certain stocks can create liquidity issues, making it hard to exit positions at desired prices. This can trap traders in losing trades, forcing them to sell at a loss or hold positions longer than planned, disrupting their strategy and increasing exposure to market swings.

Steep Learning Curve

Day trading demands extensive knowledge, time, and resources. Many underestimate the expertise required, assuming quick success without mastering market trends, technical analysis, or trading platforms. Competing against seasoned traders and algorithms is daunting for novices, and the lack of preparation often leads to costly mistakes.

Check tomorrow for more on day trading, including how to control emotions.

💰 Be a Better Investor

"Money is a guarantee that we may have what we want in the future. Though we need nothing at the moment, it insures the possibility of satisfying a new desire when it arises."

Aristotle

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👩🏽‍⚖️ Legal Stuff
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