SWS -Stock Market Recap 04.06.25

Another exciting week on Wall Street

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Simplify Wall Street
April 06, 2025 • Estimated Reading Time: 7 minutes

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Welcome to another exciting week with Simplify Wall Street, where we simplify the complex world of Wall Street, one post, one tool and one trade at a time.
🗓️ General Market Analysis (Free)

US Stocks setup for a bull run or 2-3 year bear market? 🤔 

Source: BlackRock Fundamental Equities, with data from Damodaran covering calendar years 1928-2023. Chart shows average performance of U.S. stocks as compiled by Aswath Damodaran of the Stern School of Business. Past performance is not indicative of current or future results. Indexes are unmanaged. It is not possible to invest directly in an index.

Trending

Stagflation Ahead — But Smart Investors Can Still Win

Let’s simplify:
The Fed and economists are warning that the U.S. could soon face stagflation — a rare combo of slow economic growth + high prices.

What’s stagflation?

  • Slow growth

  • High unemployment (though it's not terrible yet)

  • Stubborn inflation
    The last big one was in the 1970s, driven by oil prices.
    This time, it's fears around new tariffs and trade policies that could push prices up while growth slows.

What do stocks do during stagflation?

  • Defensive sectors & commodities tend to hold up
    🚫 Growth and discretionary sectors usually suffer
    ⚠️ Overall market stays choppy or declines — not a great environment for broad stock gains.

Current News:

  • Powell admits: New tariffs could make prices go up even more. 👉️ read

  • Jobs are still strong: Unemployment is low at 4.1%, far better than the 9% we saw in the 1970s.

  • But people are struggling: 77% of Americans say their paychecks aren’t keeping up with rising prices.

  • Economists call it “stagflation-lite” — not a full-blown crisis, but warning signs are definitely there.

What This Means for Investors: Action Steps

  1. Build / Protect Your Emergency Fund
    ➔ Aim for 3–6 months of essential expenses. Cash is safety.

  2. Pay Down High-Interest Debt
    ➔ Fed is unlikely to cut rates soon. Credit cards and loans stay expensive. Eliminate that drain.

  3. Adjust Your Portfolio for Risk
    ➔ If you’re close to retirement, lower your stock exposure.
    ➔ If you’re younger, stay in, but prepare for volatility.

  4. Diversify Smartly
    ➔ Broad-market ETFs (like S&P 500 ETFs) are good if you don’t want to pick individual stocks.
    ➔ Add "recession-proof" stocks: healthcare, consumer staples (stuff people always need).
    ➔ Look at inflation hedges: real estate, TIPS (Treasury Inflation-Protected Securities).

  5. Stay Calm During Market Swings
    ➔ Volatility is normal in uncertain times. Don’t panic sell. If you’re invested right for your time horizon, ride it out.

Upcoming Earnings (next 5 days)

Euro vs USD

Euro Surges as Tariffs Slam the U.S. Dollar

What’s happening:

  • The Euro just hit a six-month high, closing in on $1.10.

  • The U.S. dollar is falling hard, dragged down by new global tariffs.

  • Trump’s new tariffs are shaking up currency markets:

    • Europe faces a 20% tariff.

    • China is hit even harder — total tariffs now at 54%.

    • 180 countries now face U.S. tariffs.

Markets reaction:

  • The Dollar Index (DXY) dropped to a six-month low.

  • Euro rises as traders flee the U.S. dollar.

  • Japanese yen and British pound (GBP) are also climbing.

  • U.S. stock futures are dropping fast, with big names like Apple taking a hit.

Why this matters:

  • Tariffs are inflationary — they raise prices at home (for the U.S.).

  • Tariffs usually boost a country’s currency, but here the risks are too big:

    • Trade isolation

    • Higher consumer costs

    • Slower growth

  • So, instead of helping the dollar, traders are selling it off and moving to safer bets like the Euro and Yen.

🚀 Past Reads | View 👉️ Posts
📰 Other Business News on Wall Street

Private Equity Moves:

  • Siemens to Acquire Dotmatics for $5.1B
    Siemens is buying U.S.-based scientific software company Dotmatics to expand its Life Sciences portfolio and industrial software reach.
    Read more →

  • Thames Water Picks KKR as New Owner
    Utility giant Thames Water chooses private equity firm KKR for a £4 billion rescue plan amid heavy debt pressures.
    Read more →

Venture Capital Activity:

  • Runway AI Raises $300M Series D
    AI video startup Runway pulls in $300 million, led by General Atlantic, with backing from NVIDIA, SoftBank, and more.
    Read more →

  • Plaid Completes $575M Secondary Sale
    Fintech giant Plaid sells $575M worth of shares in a secondary sale at a $6.1B valuation. Major players like BlackRock and Fidelity are in.
    Read more →

  • Actively AI Raises $17.5M Series A
    Actively AI, a GTM "superintelligence" startup, secures fresh funds led by Bain Capital Ventures and First Round Capital.
    Read more →

  • What is Wall Street not talking about?

  • Our Holdings

  • Investment Deep Dive stock research $XOM ( ▼ 7.2% ) For this week’s deep dive
    👉️ Read Here.

  • 5 chart analysis

  • Investing and Swing Trading Insights

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