Liberation Day is here, futures lower, Tesla’s sales slump, extreme fear, Rogers hits 12-year low
I spent the last 20 minutes looking for a fifth thing. I thought, maybe I’ll just do four things today. But you deserve better than that. With all you have to deal with right now, shrinkflation in this newsletter won’t be one of them!
A brand new episode of In the Money with Amber Kanwar is out right now! We spoke with Dan Rohinton of iA Global Asset Management about how investors can weather the tariff storm. It includes what he calls a “generational buying opportunity” in tech stocks. Watch now!
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D-day: Futures are falling ahead of US President Donald Trump’s “Liberation Day” tariff announcement this afternoon at 4pmET from the Rose Garden. Somehow stocks managed to finish higher yesterday. “A good handful think the Tariff announcement will be a ‘buy the news’ event as it removes a bit ‘uncertainty’ overhanging the market,” wrote Dave Lutz of Jones Trading. The rumours about what the tariffs will look like are flying fast and furious and I see little value in repeating them and prefer to just wait and see what it looks like come 4pm. While investors may be tempted to “buy the dip”, data suggests tariffs are already crimping the US economy. Yesterday’s read of the manufacturing sector showed prices paid soared to the highest level since 2022 while manufacturing activity contracted and employment came in at the lowest level in 6 months. The math on that is: inflation + slowing growth = stagflation.
In reverse: Shares of Tesla are falling nearly 3% in the pre-market on preliminary data that shows sales are falling in China. March deliveries in China fell 11.5% from last year according to China’s Passenger Car Association. Investors are awaiting global sales figures due out before the opening bell. This will give a sense of how much Elon Musk’s new political hobbies have affected sales. Ahead of that, the stock is becoming a favourite target for short-sellers. The short position jumped 21% with 3% of the shares outstanding now short the stock.
Rotten: Shares of BlackBerry are plunging 12% in the pre-market after warning sales and profit for the year will be lower than expected. While revenue in the reported quarter didn’t fall as much as expected, investors are focused on the fact the company is projecting a steeper drop in sales than feared. The embattled tech company has been reducing exposure to some parts of cybersecurity and leaning on strength in so-called “internet of things” technology primarily used in cars. BlackBerry is hosting a conference call right now and notes that 50% of their revenue comes from outside the US in an effort to calm investor fears about the impact of tariffs. Spending at the US Federal level (it’s about 20% of their secure communication business) is also something investors are watching. The CEO just said on the call they haven’t seen any material impact from reduced spending intentions through DOGE.
Notable calls: Rogers plunged to a 12 year-low and caught a downgrade from Scotia’s Maher Yaghi yesterday. Rogers was punished for paying up for a 12-year broadcast renewal deal with the NHL for $11 billion (double what they paid last time). “We recognize that this call might be late, however until we start to see positive earnings revisions (expecting negative revisions entering reporting season) we don’t see an impetus to remain bullish,” wrote Yaghi in yesterday morning’s downgrade. Charles Schwab is getting a lift pre-market after Citi upgraded the stock to buy in part because it has low exposure to crypto. “We prefer names that are exhibiting improving/stable core growth trends and lower levels of crypto and capital markets sensitivity,” wrote Citi’s Christopher Allen, “For most names, we have reduced our earnings estimates due to market-driven and/or capital markets revisions. (Schwab) was the exception where improving (net new assets) trends, better-than-expected trading and capital return outlook provided an offset,” he wrote. Price target is $102/share which implies 30% upside. Raymond James is downgrading United Airlines ahead of earnings. “While we believe the recent pullback at UAL has overcorrected relative to the current environment where premium and long-haul international demand remain solid, we see greater earnings risk if these segments start to falter,” wrote Savanthi Syth. She prefers Delta Airlines here.
Be greedy when other’s are fearful: In case you are wondering how we are feeling ahead of tariffs…
