Market Recap: ASX Rebounds 2.27% as Oil and Tech Stocks Rally Despite Trade War Threats

Good Evening,

Welcome to Equity Espresso’s Daily Market Recap. The ASX staged a comeback today that would be worth celebrating if we hadn't just witnessed the market equivalent of falling down two flights of stairs. Plus, some potential good news on the horizon from the RBA. Let’s jump in.

Local Market

Typically if markets rise 2.2% in a day then it’s time to jump for joy. Not today though, with Monday's (-4.23%) and last Friday's (-2.44%) sell-off still fresh in investors' minds.

We’ll take the sight of green though. The S&P/ASX200 index rebounded today, rising 166.7 pts. (+2.27%) to close at 7,510.0, breaking a three-day-losing streak.

All sectors closed higher, with Energy (+4.63%) the standout, gaining back some of the heavy losses from the last couple of days. Brent crude oil futures rose by 1% to $US64.90/bbl after a sharp three-day sell-off from $US74.50. Whitehaven (+8.74%) and Santos (+5.40%) were the big movers. Technology (+4.63%) also rose sharply, with Life 360 (+7.95%) and Technology One (+6.95%) the biggest movers, the latter benefiting from a broker upgrade.

Markets are pricing in a 96% chance of an interest cut of 50bps to 3.60%, according to the RBA rate tracker, with more cuts to follow throughout the year. The RBA next meets next on May 19-20.

China and U.S. trade relations are the big watch for the ASX right now. U.S. President Trump threatened an additional 50% tariff on China in a Truth Social post unless Beijing withdraws its 34% retaliatory tariff by today. That didn’t happen. Instead, China pledged to retaliate against the tariff threats. “The US threat to escalate tariffs on China is a mistake on top of a mistake,” the Chinese Ministry of Commerce said today. “If the US insists on its own way, China will fight to the end.” The U.S. president said that a new 50% levy would take effect Wednesday, April 9, calling China "the biggest abuser" of trade.

Overnight, some of Wall streets heavy hitters weighed in on Trump's Tariffs:

• Jamie Dimon (JPMorgan CEO): Tariffs will "likely increase inflation," slow growth, and risk "potentially disastrous" fragmentation of economic alliances. Urged the U.S. to pursue free trade agreements, especially with allies like Australia.

• Larry Fink (BlackRock): "Most CEOs I talk to would say we are probably in a recession right now." Warned stocks could fall another 20%.

• Stanley Druckenmiller: Does "not support tariffs exceeding 10%."

• Bill Ackman (Pershing Square): The U.S. is "heading for a self-induced, economic nuclear winter.", calling for a 90-day pause.

Wall Street futures markets indicate a rebound is in store for U.S. stocks on Tuesday, with the S&P500 (+1.09%) and NASDAQ (+0.87%) both higher this afternoon.

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