The S&P500 surrendered early gains overnight following President Donald Trump’s declaration that tariffs on Canada and Mexico would proceed as planned, and AI behemoth Nvidia (NVDA US) reversed lower. Trump confirmed the proposed 25% tariffs on Mexico and Canada will take effect on March 4 after the one-month moratorium ends. The president also said China, which already faces 10% tariffs from the U.S., would face an additional 10% levy. This unsettling rhetoric makes it hard to envisage the S&P500 extending recent gains even with the prospect of lower taxes and deregulation down the track.
- We can see the S&P500 rotating between 5750 and 6250 over the coming months, making the risk/reward still unattractive even after last night’s fall
MM is neutral toward the S&P500 ~5850
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