00:00 Speaker A
US stock futures pushing higher off the back of President Trump’s tariff exemption announcement for technology products. But how long can the optimism on Wall Street last as the president says tariffs will be coming for the sector. Joining us now, we’ve got Yahoo Finance markets reporter, Josh Shafer here. Okay, so Josh from the street’s expectations how long can some of the fervor for buying on the dip that we’ve seen enter into the fray continue to move forward?
00:27 Josh Shafer
Yeah, Brad. I think what we have here at least this morning is kind of a classic better than feared. We talk about that a lot when it comes to news that you hear about different stocks, right? And I think Wedbush’s Dan Ives put that well over the weekend. Dan Ives, of course a tech analyst, him saying essentially this takes the worst case scenario off for a lot of these tech companies. So some of these products, we were talking, Matty, we’re just talking about computers, smartphones, etc. Okay, they’re not going to get a 145% tariff. That’s probably markedly good news, right? But they’re going to get some tariff, and so what is that tariff actually going to be? What products is it specifically going to be on? Again, we sort of are left with this looming question. One thing I’m sort of writing this morning and I took away from some of the research over the weekend, several Forest Gump quotes in research over the weekend. And I actually think it’s pretty fitting.
01:29 Speaker A
Life is like a box of chocolates.
01:32 Josh Shafer
You never know what you’re going to get with the tariffs, Brad. I think that’s a little bit what I felt like this weekend though, right? Saturday morning, you come, you look online, it looks like, okay, all these products are exempt. Then by Sunday, you see the president posting on Truth Social and those products aren’t actually exempt. And I think that’s why you’re seeing, yes, a rally this morning, but still not a rally to the point where every or strategist across Wall Street are feeling confident in the path higher. A lot of people talking about potentially trading in a range between maybe 5,000 to 5,500 on the S&P 500 as we sort of wait and see and figure this out. The administration has made clear we are not really at the end of knowing what these tariffs are at this point.
02:21 Speaker B
But never knowing what you’re going to get is a worst nightmare for companies, especially as we are now officially in the second quarter earnings cycle. What do you anticipate hearing from companies who have no real certainty at this time and are trying to deliver forward guidance in a time where in one weekend you have to update your story multiple times because tariffs are constantly changing?
02:51 Josh Shafer
Yeah, I mean, I was speaking to Kevin Gordon over at Schwab on Friday and he was saying that he sort of argued, what can you really expect to hear from companies? Essentially saying that he doesn’t feel like we’re going to get a lot of good data from companies and a good understanding because they don’t know either and it’s just simply a moving target at this point. I thought DataTrek Research pointed out an interesting thing though, Maddie, when it comes to earnings, and we keep talking about guidance and what are these companies going to say about the full year, but Nicholas over there was highlighting this morning the importance of companies still beating earnings expectations for the first quarter. Essentially saying, don’t forget that the actual numbers they’re reporting for the first quarter do matter and when we’re talking about bear versus bull market, what sort of market are we in, what environment are we in? Well, typically the S&P 500 companies beat earnings by about 6% for the quarter that they’re reporting, that first quarter. And he was sort of arguing you still want to see that health going into whatever this tariff uncertainty is and it’s similar to economic data we’ve been talking about too, right? You want to see companies were in a good position before we enter this moment of uncertainty and perhaps not losing that perspective over the next couple weeks too, okay, where were we before we started this? And if we’re not going to get clarity, people are just going to pull guidance. If we maybe we have a solid understanding that we were on good footing before whatever is happening and then we start getting into the chocolate comparisons and maybe the chocolate will be bitter, maybe it will be sweet, I guess we’ll find out.
04:56 Speaker A
All right. Well, I got a box of chocolates on my desk and I still got to work through.
05:03 Speaker B
We got to test them out.
05:05 Josh Shafer
Yeah.
05:05 Speaker A
See what kind of tariffs we’ll get.
05:07 Speaker B
Josh, thanks so much.