By 1. Immediate Market Impact:
- Pre-market moves: S&P 500 futures down 0.6%, Nasdaq -0.9% as tech stocks react to potential H-1B visa restrictions.
- Defense sector hit: Lockheed Martin (LMT -4.2%) on fears of NATO spending cuts; Raytheon (RTX -3.7%).
2. Derivatives Tell the Story:
- CBOE Skew Index (measuring tail risk) jumps to 145, highest since January 2023.
- Put options on Trump-linked SPACs (DWAC) surge 300% in volume.
3. Behind the Numbers:
- Hedge fund positioning: Goldman Sachs prime brokerage data shows institutional clients reducing equity exposure to 47% (from 52% in March).
- Private equity response: Apollo Global and Blackstone accelerating European deal pipelines as “Trump hedge.”
4. Expert Counterpoints:
- Bull case: Strategas notes infrastructure stocks (CAT, FLR) could benefit from Trump’s $2 trillion rebuilding plan.
- Historical precedent: 2018 market rallied after initial tariff threats faded.