US Stock Outlook | Optimistic Signs in Tariff Policy, Traders Return to Tech Stocks

1. As of March 24 (Monday) before the US stock market opens, the three major US stock index futures are all rising. As of the time of writing, Dow futures are up 0.95%, S&P 500 futures are up 1.18%, and Nasdaq futures are up 1.48%.

1. As of the time of writing, the German DAX index is up 0.48%, the UK FTSE 100 index is up 0.13%, the French CAC 40 index is up 0.20%, and the Euro Stoxx 50 index is up 0.24%.

1. As of the time of writing, WTI crude oil is up 0.78%, priced at $68.91 per barrel. Brent crude oil is up 0.68%, priced at $72.10 per barrel.

Market News

Trump's tariff plan adjustment, US Treasury yields rise, market risk appetite warms up. White House officials revealed that Trump will announce more targeted reciprocal tariffs on April 2, and the market expects a narrowing of the tariff range, alleviating concerns about global trade and economic growth. The yield on the US 10-year Treasury rose 4 basis points to 4.29%, while the German bond yield rose 3 basis points to 2.80%. Special tariffs on automobiles and semiconductors are not included in this plan, and market risk sentiment has slightly improved.

Tariff clouds linger, the Fed's favorite inflation indicator is coming! A critical week for the US market. As tariff clouds continue to loom over the market, the US stock market barely closed higher last week. Looking ahead to the coming week, market nerves remain tense, with Trump's tariff policy still hanging over like the "Sword of Damocles," and the inflation indicator favored by the Fed is about to be revealed, which may become another "trigger point" for the market. In the coming week, the inflation indicator that the Fed is focused on will be in the spotlight. The market will also pay attention to manufacturing and service activity data, consumer confidence index, and the final value of Q4 GDP. On the corporate side, quarterly performances of Dollar Tree Inc. (DLTR.US), Lululemon Athletica (LULU.US), and KB Home (KBH.US) will attract market attention.

US Treasury Secretary determined to suppress interest rates, Wall Street responds by lowering US Treasury yield forecasts. US Treasury Secretary Scott Bessent has repeatedly emphasized the need to suppress the yield on 10-year US Treasury bonds in several speeches. Controlling government borrowing costs has long been part of the Treasury's work—however, Bessent's strong willingness to suppress the benchmark US Treasury rate has led some Wall Street analysts to abandon their forecasts for 2025 In the past few weeks, the chief interest rate strategists at Barclays, Royal Bank of Canada, and Société Générale have lowered their year-end forecasts for the 10-year U.S. Treasury yield, partly due to Bessen's attempts to suppress yields. They added that this is not just verbal lobbying; Bessen can also take concrete actions, such as limiting the size of 10-year U.S. Treasury auctions or advocating for relaxed bank regulations to boost bond demand.

It is reported that the Trump administration plans to promote the privatization of Fannie Mae and Freddie Mac, with critics warning that it could disrupt the mortgage market. According to media reports citing informed sources, the Trump administration is studying an executive order that could pave the way for the privatization of Fannie Mae and Freddie Mac, two mortgage giants that support more than half of the mortgage business in the U.S. It is reported that this potential plan will instruct federal agencies to evaluate the idea, with supporters arguing that it could reduce the federal budget deficit and provide returns to taxpayers. Bill Pulte, the head of the Federal Housing Finance Agency (FHFA), has already implemented thorough reforms of the two government-sponsored enterprises since taking office. In his first week, Bill Pulte fired a dozen board members of the two entities, appointed himself as chairman, and brought in new directors, while FHFA employees and executives, including Freddie Mac CEO Diana Reid, were also fired or placed on leave.

Goldman Sachs: The decline in U.S. stock market sentiment may release bullish signals, and foreign capital is expected to further buy into U.S. stocks. David Kostin, Goldman Sachs' chief U.S. equity strategist, stated in a report on March 21 that the sharp decline in investor confidence, the contrast in global stock market performance, and the changing holding trends are raising key questions about the future trajectory of the U.S. stock market. It is reported that last week, Goldman Sachs' U.S. stock sentiment indicator fell from -0.5 to -0.6, marking the largest six-month decline for the indicator since 2020. This indicator is a composite measure made up of six weekly indices and three monthly indices, designed to reflect the stock market positions of institutional, foreign, and retail investors. Although the level of this indicator remains above historical lows, this sudden change indicates a significant shift in market sentiment. As investor sentiment shifts, concerns about the relatively poor performance of the U.S. stock market are growing.

Individual Stock News

Optimistic signs in tariff policy, traders return to tech stocks. Traders are buying up depressed tech stocks and feeling optimistic about signs that U.S. tariffs may become more targeted. Morgan Stanley strategists believe that a turning point is imminent for the U.S. stock market. They informed clients that the dollar has fallen 3.8% from its January peak, and the seven tech giants are showing signs of bottoming out, which may attract capital back to the U.S.

Barron's: Nvidia (NVDA.US) stock is undervalued, with an expected price-to-earnings ratio of only 26 times. According to a report from Barron's last week, Nvidia's stock is relatively undervalued. Despite Wall Street expecting its revenue to grow by 57% this year, its expected price-to-earnings ratio is only 26 times. The financial publication stated that investors' concerns mainly focus on three issues: competition from China's DeepSeek AI model, increasing competitive pressure from chip manufacturers like Broadcom (AVGO.US), and the possibility of the U.S. imposing tariffs on chip imports At the NVIDIA annual GTC conference held last week in San Jose, California, CEO Jensen Huang directly addressed these concerns. He pointed out that DeepSeek's advanced inference model has actually increased the demand for NVIDIA GPUs, as the required computing power far exceeds previous expectations.

Tesla (TSLA.US) suspends FSD trial push in China, to officially launch after regulatory approval is completed. Tesla stated on Monday that it will launch its smart driving assistance feature in the Chinese market after completing the regulatory approval process. Previously, users reported that the company's full self-driving service's limited-time trial event had been temporarily suspended.

Nippon Steel sees light in acquiring U.S. Steel (X.US), negotiations are still ongoing. Nippon Steel President Imaï stated on Monday local time that negotiations regarding the company's planned acquisition of U.S. Steel, a leader in the American steel manufacturing industry, are still proceeding in an orderly manner with the U.S. government. Imaï indicated that both parties are gradually reaching a consensus, believing that this transaction will strengthen the U.S. steel industry. He added that the negotiations have not been terminated due to pressure from the Trump administration, as previously reported by the media, but are continuing in an orderly manner, aiming to reach significant agreements on equity purchases and capital expenditures. The latest statement from the Nippon Steel president suggests that this major acquisition of U.S. Steel, initiated by Nippon Steel in 2023, has finally seen a glimmer of hope after facing strong resistance from the U.S. government.

SAP (SAP.US) surpasses Novo Nordisk (NVO.US) to become the highest-valued company in Europe. SAP has replaced Danish weight-loss drug manufacturer Novo Nordisk as the highest-valued publicly traded company in Europe. The German software giant's stock price rose 1.6% on Monday, bringing its valuation to approximately €314 billion (about $340 billion), with the increase primarily driven by investor confidence in its growing cloud software business. As SAP's market value surpasses that of Novo Nordisk, the latter's stock price has fallen 16% this year due to disappointing clinical trial results for its new generation weight-loss injection CagriSema.

Important Economic Data and Event Forecasts

Beijing time 21:45: U.S. March SPGI Manufacturing PMI preliminary value.

Next day Beijing time 02:00: Bank of England Governor Bailey speaks.

Next day Beijing time 03:10: Federal Reserve Governor Barr speaks on "Small Business Loans."

Earnings Forecast

Tuesday pre-market: Canadian Solar (CSIQ.US), Viomi Technology (VIOT.US)