So let's dig into the 10 Things You Need to Know About Markets Right Now.<\/p>\n
1. This Weekend's 4D Chess Match Is BIGLY<\/h2>\n
The market is eager to see the results of this weekend's trade talks between the US and China.<\/p>\n On Friday morning, President Trump said on Truth Social that “80% Tariff on China seems right! Up to Scott B.”<\/em><\/p>\n This is lower than the 145% tariffs that are on some Chinese products now… but it sounds like just another random number as the President engages in what his fans like to call “4-D chess.”<\/p>\n Regardless, the market wants more progress on trade ASAP.<\/p>\n We already have a US-UK trade agreement, so a deal with China would be a major positive, since it would inspire\u00a0 even more countries to strike agreements.<\/p>\n But based on the wacky news flow we've seen since April 2 a.k.a. “Liberation Day” – anything can happen.<\/p>\n So hold onto your hats.<\/p>\n And yes, there's a CPI report coming on Tuesday, but trade is everything right now.<\/p>\n When President Trump was elected, the Trump Trade was led by Tesla<\/strong> (TSLA) and Bitcoin.<\/p>\n But “The Ultimate Trump Trade” may be in brokerage stocks like Robinhood<\/strong> (HOOD), Interactive Brokers<\/strong> (IBKR) (a name I own), and Webull<\/strong> (BULL).<\/p>\n Why?<\/p>\n Because the President is giving us nonstop reasons to put on trades.<\/p>\n And they're kicking butt so far in May:<\/p>\n Now, there is a tricky balance here.<\/p>\n The ideal scenario is nonstop volatility that leads to rising stock prices.<\/p>\n Because if the market gets wiped out, that's when people start closing accounts and ignoring stocks altogether.<\/p>\n Higher rates would also help these stocks because that means increased profitability on margin loans to traders.<\/p>\n There were two real stories this earnings season.<\/p>\n The first was a large number of companies pulling guidance because of the tariff drama – like Snap<\/strong> (SNAP), United Parcel Service<\/strong> (UPS), and American Airlines<\/strong> (AAL).<\/p>\n The second was earnings being way better than anyone expected.<\/p>\n According to our friends at FactSet<\/a><\/strong><\/span>, Q1 earnings were expected to grow by 7.2%.<\/p>\n Yet they grew at 12.8%.<\/p>\n Factset said:<\/p>\n “Both the percentage of S&P 500 companies reporting positive earnings surprises and the magnitude of earnings surprises are above their 10-year averages.”<\/p><\/blockquote>\n Plus there's more good news.<\/p>\n Q2 estimates are coming down faster by an above-average margin.<\/p>\n That means low expectations.<\/p>\n Sentiment has been negative for most of 2025.<\/p>\n But it's getting better now thanks to the SPX' 17% rally off the April lows.<\/p>\n The AAII Sentiment Survey shows that 29.4% of investors are bullish, up from 20.9% last week:<\/p>\n 29.4% is lower than the historical bullish average of 37.5%, but it's the highest level since February 5.<\/p>\n Nothing changes hearts and minds like a nice fat rally.<\/p>\n But Bitcoin's been going wild, with the IBIT<\/strong> ETF up 25% since the end of March, crushing SPY:<\/p>\n![\"\"](\"https:\/\/blog.t3live.com\/wp-content\/uploads\/2025\/05\/Serious-Calculation-with-80-Display.png\")
<\/a><\/p>\n<\/a><\/p>\n2. This Sector May Be “The Ultimate Trump Trade”<\/h2>\n
<\/a><\/p>\n3. Earnings Season Was Really Good<\/h2>\n
4. Big Hate Backs Down<\/strong><\/h2>\n
<\/a><\/p>\n5. Bitcoin Is Flying High Again<\/strong><\/h2>\n
Four weeks ago, I argued that “No One Cares About Bitcoin\u2019s Relative Strength.”<\/a><\/strong><\/span><\/span><\/h2>\n