Netflix shares rose Monday, the rare media stock that traded higher as markets swoon amid Donald Trump’s tariffs and the president’s ratcheted-up vitriol against Jerome Powell, the Fed chief who warned last week that the administration’s hefty new import taxes will likely trigger higher prices and slower growth.
Near close, the S&P 500 has dropped 2.6%, the Nasdaq is off near 3%% and the Dow Jones Industrial Average off shed over 1,000 points as markets grow increasingly panicked. All are off their lows for the day.
Netflix bucked the downturn, up about 1.7% to $989 after delivering well received first quarter earnings last Thursday. Media analyst Peter Supino from Wolfe Research, on CNBC today, came out for Netflix as well as Spotify, calling them particularly stable given global subscription models that offer consumers vast quantities of content. He also touted Disney as already priced for a recession, which has become a growing concern among investors. Spotify was up earlier but reversed course and is off 2.2%. Disney is down 1.2%.
Red dominated the big board. Warner Bros. Discovery is down 3%, Comcast 1.9%. Exhibitors fell along with broadcasters. Tech giants were hit hard from Snap, Amazon and Apple to Meta and Google parent Alphabet – the latter two companies, also currently struggling with landmark antitrust battles, are each down circa 3%. Google was just found guilty of violating antitrust law in digital ad tech. Facebook parent Meta is on trial for thwarting competition by buying up smaller rivals.
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Imax, Comcast and GOOG earnings roll in this week along with Tesla, whose numbers will be accompanied by highly anticipated remarks from the automaker’s CEO Elon Musk. Tesla is one of the worst performers today, down 7% as shareholders want the DOGE chief and Trump lieutenant back at the helm of his company full time.
New tariffs have buffeted markets for several months.
These taxes on imports levied by Trump are in effect on many goods from global trading partners led by a huge hit on China. Another big round of tariffs was suspended for 90 days pending negotiations and sending markets higher, but only briefly. The threat of more U.S. tariffs, as well as hefty retaliatory tariffs by other countries, is very real and hanging heavily over market sentiment. U.S. companies are treading water with many unclear where or when to invest.
Amid the angst, Trump has been attacking the Federal Reserve chief for not lowering interest rates to help avoid an economic slowdown and he rekindled his offensive today, calling the highly regarded Powell “a major loser.”
Powell has been quite measured and even-keeled in remarks but angered the president for comments in a speech that lower interest rates will likely fuel inflation. He said the Fed should not and will not take any action on rates until the scope and inflationary impact of tariffs becomes clearer.
“The level of the tariff increases announced so far is significantly larger than anticipated. The same is likely to be true of the economic effects, which will include higher inflation and slower growth. Both survey- and market-based measures of near-term inflation expectations have moved up significantly, with survey participants pointing to tariffs,” Powell said at the Economic Club of Chicago.
The Fed has a dual mandate of balancing inflation and unemployment and, traditionally, a large degree of independence in setting monetary policy. Powell has said he won’t leave even if asked and that he would fight any attempt by the president to remove him. Market players have grown increasingly anxious that Trump might just do that. “Fed independence is very widely understood and supported in Washington, in Congress where it really matters,” Powell said, and “is never going to be influenced by any political pressure.”
“Powell’s termination cannot come fast enough,” Trump — who appointed Powell during his first term — wrote the next day on his social media network Truth Social, sparking debate over what he meant by “termination.” Powell’s term expires in May of 2026.
Today, Trump posted: “Preemptive Cuts” in Interest Rates are being called for by many. With Energy Costs way down, food prices (including Biden’s egg disaster!) substantially lower, and most other “things” trending down, there is virtually No Inflation. With these costs trending so nicely downward, just what I predicted they would do, there can almost be no inflation, but there can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW. Europe has already “lowered” seven times. Powell has always been “To Late,” except when it came to the Election period when he lowered in order to help Sleepy Joe Biden, later Kamala, get elected. How did that work out?”
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