Market Snapshot

River1 Asset Management
April 10, 2025

Morning Note

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Trading Observations

Pullback not unexpected after the surge or “Bear Market Bounce” to some, let's hope it's contained
35/1 upside day with total vol at the level of Monday bottom reversal
93.96% of all the stocks on the NYSE advanced
CPI came in slightly light, helping inflation fears
Bond market stabilized (yields down) so guess would be we try and rally post open
Let's hope we get a major deal or two over next 60 days so we not right back into the vacuum. Per Hassett: A Few Trade Deals Really Well Advanced
5500 next hurdle, but 5750 (200-day) really the battle line
Also this, "Trump’s trade war is far from over. Corporate America is breathing a sigh of relief, but EPS estimates continue to face downside risk (recall that the airlines cut their Q1 guidance back in Mar, before the Apr 2 chaos). The scrapped House reconciliation vote is a (small) negative as it reveals the significant math problem plaguing Republicans as they attempt to work on the bill (investors need to start thinking about less permanency, the potential for some tax hikes, and more aggressive austerity measures)."

Futures

DOW -625

S&P -109

Nasdaq -472

Charts/Sentiment

CNN Fear/Greed Index

U.S. 10 Year Treasury

ICE Brent Crude

Bitcoin

Financials / Retail / Healthcare

JPM leaves recession rates at 60% after calculating 10% across the board and 125% on China is really 25% net, up from 22% on Day 1.

KMX – CarMax down 8% on guidance pull and meh quarter.

COST – Baird reiterates outperform as March Comps at +7.6% missed to Feb’s +8.3% but is in line with expectations.

Baird on Senior Housing – They see outsized SSNOI on growth within and external. Valuation in WELL and VTR remain lofty on scarcity.

WMT – Host of positive Sell-Side notes after Investor Day yesterday.

JPM on SMID Banks – Cautious, although the tariff pause a positive.

BX – Added to its warehouse bets with a $718MM Texas purchase.

CPRI – Announced they will sell Versace to Prada. Stock up 3%.

STZ declines 2.4% after issuing downbeat guidance for the year as new US tariffs and muted demand weigh on the beer, wine and spirits maker.

Technology

Megacaps: MSFT/GOOGL-1.3%, AAPL-2.2%, META-2.4%, NVDA-2.8%, AMZN -1.8%

SEMIS: MediaTek reports March revenue NT$56.00B, +10.9% y/y - Press Release; Taiwan Semiconductor reports March revenue NT$285.96B, +46.5% y/y - Press Release; ASE Technology March Sales NT$53.75B - Press Release; Luxshare to Prioritize SE Asia for Electronics Expansion - Yicai; SK Group Chairman Met With TSMC Chief This Week - Yonhap; Indian Startup Unveils System to Run AI Without Advanced Chips - Press Release

AAPL: airlifted 600 tons of iPhones (about 1.5M units) out of India to beat Trump's tariffs (Reuters) .... Apples is turning to India to help blunt the fallout from Trump’s trade war (FT)

AMZN: Jassy publishes 2024 letter ... CEO letter to shareholders out. Heavy on the AI outlook. Sees multi-billion rev run from AI, currently running at trip-digit YoY %age growth. More than 1000 GenAI applications being built on AWS. Also adds new Trainium2 chips are 30-40% higher perf than current GPUs available. Planning to have 3200 satellites in orbit over next few years to help build broadband connectivity

APP: -0.5% upgraded at MS to OW - now sees an opportunity to buy ad tech's "best executor 'on sale.'" AppLovin is among the most resilient names in advertising, given its high exposure to direct response budgets and innovation-driven outperformance versus its end market

DDOG: -3% CEO sells $9.4M of stock

DELL: dials back on discounting as it prepares for Trump’s tariffs (Bloomberg

GOOG / NVDA AI - Alphabet said on Wednesday it was still committed to spending some $75 billion this year to build out data center capacity despite turmoil over U.S. tariffs and sought to reassure investors that its AI plans were yielding good returns. – Reuters

MSFT confirmed slowing or pausing some AI data center projects.

NVDA: The White House has put on a hold a plan to impose additional restrictions on Nvidia’s ability to sell its H20 chip in China - NPR

TSM Q1 sales ahead on AI and smartphone demand, though also some focus on potential frontloading ahead of tariffs.

Industrials

GM/UBS Auto call: cut ests to reflect the impact of tariffs on the co's cost structure as well as the impact to auto demand. UBS assumes vehicles produced in Mexico and Canada have 50% U.S. content, so it applies a 25% tariff to 50% of the assumed $35,000 material cost per vehicle. It estimates that if left unmitigated, GM's annual cost headwind from tariffs could be $5B. It cut estimates and downgraded the shares ... also slashed TSLA PT

Aptiv Plc (APTV) downgraded to neutral from buy at UBS

Axalta (AXTA) Raised to Outperform at BNPP Exane; PT $38

BorgWarner (BWA) Raised to Buy at Goldman; PT $34

BorgWarner (BWA) downgraded to neutral from buy at UBS

Ford (F) Cut to Neutral at Goldman; PT $9

General Motors (GM) downgraded to neutral from buy at UBS

HOG board representative of second-largest shareholder stepped down over concern about direction under current management.

ITT – reports preliminary Q1 EPS $1.43-1.45 vs FactSet $1.43; announces intent to repurchase up to $500M of shares.

Lear (LEA) downgraded to neutral from buy at GS

Sensata (ST) Raised to Buy at Goldman; PT $27

Sensata Technologies (ST) discloses ransomware attack, but does not expect material impact; guides Q1 to be within or exceed prior guidance ranges - 8-K.

Visteon (VC) downgraded to neutral from buy at UBS

Vulcan Materials (VMC) upgraded to outperform from peer perform at Wolfe Research

QuantumScape (QS) downgraded to sell from neutral at UBS

Latest Media

We believe the bottom of the stock market is in.

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