Good morning! Welcome to a packed week of economic data, trade war updates, and trading events. This morning we’re covering how markets are positioning for Trump’s big announcement. First time reading? Join 190,000 self-directed investors gaining an edge every morning. Sign up here. 

Trade war with the gravity of monetary policy

Turns out economic restructuring is easier to declare than define. 

President Trump says his April 2 tariffs will mark America’s “Liberation Day,” but markets are behaving more like they’re waiting for a Fed decision than a trade policy rollout.

In a different era, you might expect tariff headlines to hit specific sectors like autos, industrials or semiconductors. This time, it’s macro anxiety embedding itself into everything from inflation forecasts and portfolio positioning to hiring plans. 

Investors are stuck in wait-and-see mode — behavior typically reserved for Jerome Powell, not tariffs.

That suggests that what’s at stake isn’t just trade but the direction of the economy itself. 

“Tariff uncertainty is now itself a drag on economic confidence,” Morgan Stanley strategists said Sunday.  

The White House intends for its reciprocal tariffs to rebalance global trade, but so far, the details remain unclear.

Morgan Stanley forecasts Wall Street to lose increasing amounts of confidence unless the administration “clarifies the pathway forward” for its trade agenda. That lack of clarity has weighed on equities.

The S&P 500 now hovers 9.2% lower from its record high on February 19, while the Nasdaq has dropped back into correction territory. 

If April 2 brings more escalation than clarity, the exit could get even more crowded. 

But the jitters haven’t been exclusive to Wall Street.

CNBC’s latest CFO survey found that the majority of respondents expect tariffs to fuel resurgent inflation, and most are bracing for a recession in the second half of 2025.

Consumers, too, have raised their inflation expectations to multi-year highs. Small business confidence has also taken a hit. 

Early Monday, even Yardeni Research — one of the most bullish teams on Wall Street — raised its odds for a stagflation scenario from 35% to 45%. 

“We are losing our confidence that it can remain resilient in the face of Trump’s Reign of Tariffs,” Yardeni strategists wrote in a note Monday.

“The latest batch of data suggests that stagflation is already eroding the stellar performance of the economy, which hasn’t been in a recession since the pandemic lockdown in early 2020.”

Time will tell whether President Trump’s “Liberation Day” earns its name — but markets so far aren’t buying it. Rather, confidence on what comes next has flattened across the board. 

Remember: Markets don’t mind bad news, but they can’t stand guessing games. 

It’s a mistake to expect Trump to answer every tariff-related question on April 2. Ideally, he reveals just how committed he is to reordering global trade. 

Whether markets can absorb it without a broader repricing remains to be seen.

Market snapshot:

Elsewhere:

📉 Stock futures are red. US futures markets turned lower Sunday night ahead of a busy week headlined by tariff news Wednesday and the March jobs report Friday.

🇷🇺 President Trump is “very angry” with Putin. He told NBC News Sunday that he is “pissed off” that the Russian leader for criticizing the credibility of Ukraine President Zelenskyy’s leadership. Trump said he’s considering “secondary tariffs” on Russian oil if Putin refuses the ceasefire with Ukraine. (Bloomberg)

📱 Apple and SpaceX are clashing. The iPhone maker is competing with Elon Musk’s plans for satellite expansion and the race to eliminate cellphone dead zones. The companies are vying for valuable rights for airwaves to carry their signals, and sources say Apple’s outer-space investments have drawn Musk’s ire. (WSJ)

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About me:

📰 I’m Phil Rosen, co-founder and editor-in-chief of Opening Bell Daily. I’ve published books, lived on three continents, and won awards for my journalism, which has appeared in Business Insider, Fortune, Yahoo Finance, Bloomberg and Inc. Magazine.

I write our flagship newsletter to prepare you for each trading day, unpacking markets, economic data and Wall Street with analysis you won’t find anywhere else. Feedback? Reply directly to this email, ping me on X @philrosenn, or write me phil@openingbellmedia.com.