Renewed Bullish Outlook on Stocks Despite Tariff Concerns

Key Takeaways:

* Market fluctuations due to tariff plans have not significantly impacted the overall upward trend in stocks.
* Metrics such as average daily index movement and volatility remain within normal ranges.
* Strong earnings growth, bolstered by recent economic data, supports continued bullish sentiment.

Tariff Concerns and Market Performance:

President Trump's tariff announcements have caused investor uncertainty, leading to market volatility. However, despite initial sell-offs, the S&P 500 (^GSPC) has recovered, indicating investor resilience to trade war headlines.

Technical Analysis:

* The S&P 500's average daily movement has ranged around 1.1% in either direction, indicating that recent losses are not unusual.
* The CBOE Volatility Index (VIX) has not consistently exceeded 19.5, a key indicator of heightened volatility.

Earnings Outlook:

* S&P 500 companies are projected to report strong earnings growth of 13.2% for the fourth quarter.
* Analysts expect earnings to accelerate this year, despite concerns about tariffs and inflation.

Economic Data:

* The Job Openings and Labor Turnover Survey (JOLTS) shows a stable labor market, with job openings remaining high relative to unemployed workers.
* The Institute for Supply Management's manufacturing PMI indicates an expansion in the sector for the first time in over two years.

Analyst Commentary:

Equity strategists remain positive on the market outlook, citing strong earnings growth and encouraging economic data. They believe that the potential negative impact of tariffs is unlikely to materially alter market fundamentals.