Category Penny Stocks

Trump reveals his reciprocal tariff plan … do we need to worry about a recession? … your last chance to get Louis Navellier’s AI picks … a huge opportunity in natural gas

Coming into today, here’s where we stood with tariffs…

• Last week, President Trump signed an executive order putting a 25% tariff on all cars and light-duty trucks imported into the U.S.
• Trump had imposed a 20% tax on all Chinese imports.
• The administration had signaled it will add imports of beer and empty aluminum cans to its 25% tariffs on derivative aluminum products.

As we’re going to press, President Trump has just revealed the details of his master reciprocal tariff plan. We’re rushing to get today’s issue out, so here’s the quick recap of what we’ve learned.

First, Trump confirmed that the 25% tariff on non-U.S.-made cars will begin tomorrow.

As to new tariffs, Trump said that his administration will be “charging a discounted reciprocal tariff.”

Specifically, they’ve tallied the combined rate of all foreign tariffs on U.S. goods plus indirect financial impositions (currency manipulation and trade barriers). Based on that total amount, the U.S. will impose a reciprocal tariff of half that amount. Trump referred to this as “kind” reciprocal.

Trump also clarified that the U.S. will impose a minimum baseline tariff of 10% on all countries.

Here’s the “Liberation Day Reciprocal Tariffs” list from The White House:

Trump made his overall goal clear after delineating the various country-specific tariffs, saying:

If you want your tariff rate to be 0%, build your product here in America.

So, where do we go from here?

Here’s what our hypergrowth expert Luke Lango wrote earlier this week about the likely path. From his Innovation Investor Daily Notes:

We think that, despite all the intense and hostile rhetoric out there right now, everyone will rush to the negotiating table to quickly strike new trade deals in April.

We expect the tough talk to turn into a soft walk. Deals get done when the stakes are this high — and we fully expect the U.S., Canada, the EU, and others to come to the table and hammer out a flurry of new trade agreements in the next few weeks.

Consequently, we believe that most of these tariffs won’t last more than a few weeks and that by late April, most of this tariff drama will be in the rearview mirror. 

That means the trade war hysteria should cool down in the next few weeks.

And once that happens? This market should rip higher.

Let’s not forget — this selloff isn’t about what has happened. It’s about fear. Fear of what might happen. And if that worst-case scenario never shows up, the fear unwinds, and equities snap back hard.

There’s a lot to unpack from Trump’s announcement today. We’ll bring you the analysis and action steps from our analysts over the coming days.

I will note that stock futures are down big as I write with the Nasdaq off more than 2%.

Stay tuned.

To what extent do we need to worry about a recession?

On Monday, both Goldman Sachs and Moody’s Analytics raised their probabilities of a recession.

Goldman upped the odds from 20% to 35%. Moody’s went from 15% at the start of the year to 40%.

Meanwhile, if we look at the Atlanta Fed’s GDPNow tool, its latest estimate predicts a 3.7% economic contraction in Q1.

How seriously do we need to take this?

Let’s go to legendary investor, Louis Navellier, editor of Growth Investor:

The Atlanta Fed now expects the U.S. economy to contract in the first quarter – and that rattled Wall Street.

The primary reason why GDP growth is forecast to be negative in the first quarter is due to a big trade deficit, which is because of all the dumping of imported goods and an increase in gold inventory…

So, the trade deficit is now deducting a whopping 4% from first-quarter GDP growth. In other words, excluding the trade deficit, the U.S. economy is still growing.

I should also add that none of the economic tea leaves signal a recession.

Both Treasury Secretary Scott Bessent and Federal Reserve Chair Jerome Powell recently stated that the U.S. economy is “healthy.”

Louis also highlights some recent, positive economic reports.

For example, we just saw a surprising jump in existing home sales.

He also notes that the Trump administration is soliciting trillions in onshoring which, if successful, would boost GDP growth.

Put it all together and here’s Louis’ bottom line:

The U.S. is not at risk of falling into a recession.

But Louis is seeing opportunity in certain AI stocks that have imploded due to recession fears

Here’s Louis in yesterday’s Digest:

Remember, markets are manic. Wall Street has ignored a lot of great AI news lately.

[Despite AI earnings growth], investors have only focused on the negatives lately (mainly tariffs). The media only adds fuel to the fire in situations like this, because every setback in talks, and every ensuing pullback, is covered like it’s a full-blown crisis.

This has sent the prices of many world-class AI stocks into correction territory. As a result, we’re now facing a grossly oversold stock market where phenomenal companies like NVIDIA are trading at incredible discounts.

To Louis’ point, NVDA is down 27% from its January high.

And the Magnificent 7 stocks as a whole (a proxy for mega-tech AI leadership) have fallen into an official bear market.

It’s gotten so bad that bears have renamed the “Mag 7s” the “Lag 7s.”

But as we’ve been tracking here in the Digest, Louis, along with our global macro expert Eric Fry and our technology expert Luke Lango, have been urging investors to use this selloff as a chance to buy into tomorrow’s AI leaders.

This is even more important considering how AI is exploding our nation’s wealth gap.

Last week, Louis, Eric, and Luke provided a roadmap for the best way to invest in AI today in light of “The Technochasm”

This is their term to describe the widening wealth divide generated from cutting-edge technology and AI.

In their presentation, they detailed three critical steps investors must take now to stay on the right side of this growing tech divide, along with a basket of top-tier AI stocks.

Here’s Luke with what happened the last time our three analysts provided a Technochasm-themed basket of recommendations:

We called the Technochasm in 2020. So, believe us when we tell you that this is a chasm that companies and individuals either leap across or fall into. There is no middle ground.

Those who listened to us in 2020 banked ~1,350% from Freeport-McMoRan Inc. (FCX) in 11 months, ~1,000% from Nvidia (NVDA), and upward of 1,200% from Fulgent Genetics Inc. (FLGT) in under two years.

Peanuts, maybe, compared to what’s ahead.

For investors, this creates a once-in-a-generation opportunity.

If you missed last week’s free presentation, you can watch it right here. Please note that today is the last day it’ll be available.

Don’t miss this opportunity in natural gas

We’re tracking a disconnect brewing in the natural gas market that’s setting up a buying opportunity.

Gas prices are rising, but natural gas stocks are falling. In the background, demand is climbing as inventories drop.

Eventually, this should result in high-quality natural gas stocks shooting higher to reflect today’s bullish imbalance.

Eric, editor of Investment Report, highlighted this opportunity on Monday.

To establish context for his research, let’s begin by comparing the First Trust Natural Gas ETF (FCG) to the price of natural gas (a 4-week rolling average). FCG holds oil/gas heavyweights including ConocoPhillips, Hess, EQT Corporation, Occidental, and Diamondback Energy.

In the chart below, notice how FCG’s price (in green) has gone nowhere over the last two months while the price of natural gas (in black) has jumped around 35%.

From a basic “supply/demand” perspective, the rising price of natural gas makes sense – our nation’s supply levels are falling due to demand.

Here’s Eric:

U.S. natural gas in storage, relative to seasonal three-year average levels, has been dropping sharply for nearly a year.

The most recent reading showed storage levels 14% below average levels for this time of year.

Against this backdrop, U.S. natural gas demand is on track to surpass supply by a wide margin over the next two years, which should reduce stockpiles even further below three-year average levels.

Exports to foreign countries are behind much of the inventory drawdown

In February, the amount of gas flowing to U.S. export plants hit a record high. March’s export volumes are likely to set another record.

Better still, forecasts call for a continuation of the bullish imbalance between supply and demand after including U.S. exports. Here’s Eric with details:

Looking down the road, the U.S. Energy Information Administration (EIA) predicts LNG exports will grow by 2.1 Bcf/d in 2026, due to new export facilities…

Unlike domestic demand spikes that occur during exceptionally cold winters or hot summers, LNG export demand is relatively constant. Once in place, it remains in place and continues to consume domestic gas supplies…

As such, this source of demand puts continuous upward pressure on natural gas prices, especially if domestic gas production fails to keep pace.

The EIA is predicting that exact scenario. Although the agency expects domestic production to increase by 3.6% during the next two years, that figure is well below the 5.8% demand growth the agency predicts.

All the pieces are in place for higher stock prices for leading natural gas plays.

So, why aren’t prices already higher?

Part of the answer circles us back to the new segment we began last week…

Uncertainty has weighed on the oil patch

Last Friday, we began a new running segment: “Uncertainty Watch.”

Behind the segment is a lack of confidence in the direction of our economy that has begun to lead some consumers to hold off on purchases, and some corporate planners to hold off on major cap ex expenditures. Much of it stems from President Trump’s tariff plans, which have been unclear up until this afternoon.

This uncertainty has hit the oil sector. Last week, the Federal Reserve Bank of Dallas released the results of its quarterly survey of anonymous oil executives.

Here’s one such response highlighting the effect of uncertainty:

As a public company, our investors hate uncertainty. This has led to a marked increase in the implied cost of capital of our business, with public energy stocks down significantly more than oil prices over the last two months.

This uncertainty is being caused by the conflicting messages coming from the new administration.

Now, an astute reader might say, “Wait, oil and gas aren’t the same thing. I can understand oil stocks being down, but why are natural gas stocks lower, especially considering the supply/demand imbalance?”

Here’s Eric:

Tumbling crude oil prices probably deserve most of the blame…

For starters, falling crude prices cast a pall over the entire fossil fuel sector. In addition, most major natural gas producers also produce significant volumes of crude oil.

As a result, the shares of almost every North American natural gas producer have been sliding lower, no matter how little crude each company produces.

So, we’ll see how this all shakes out. But what we know for certain is that there’s a disconnect between natural gas prices and leading natural gas stocks. History shows this divergence will eventually close.

Eric recommended his favorite way to play this to his Investment Report subscribers. I won’t reveal it out of respect for subscribers, but here’s Eric referencing it:

At less than eight times earnings, its share price seems substantially undervalued, relative to both its peer group and to its “hidden” earnings potential from its holdings in the Delaware Basin chunk of the Permian.

But all that means is that this company currently offers a great buying opportunity.

Bottom line: U.S. natural gas is “Buy,” which means this natural gas play is a “Strong Buy.”

For more on joining Eric in Investment Report, click here.

We’ll keep you updated on all these stories here in the Digest.

Have a good evening,

Jeff Remsburg

Editor’s Note: After waking up on the wrong side of the bed this morning, the stock market is finding its footing this afternoon.

The fact is folks are anxiously awaiting the Trump administration’s big tariff announcements. Now, I suspect today’s announcement will be more favorable than some expect. We’ll know more following this afternoon’s event in the White House.

But rest assured, folks, I am following the developments closely and will weigh in with my thoughts in tomorrow’s Market 360. I’m also shooting a video interview with InvestorPlace Editor-in-Chief Luis Hernandez to explain what we learned about the tariffs and how investors can best position themselves to profit in this environment.

In the meantime, today is the last day to catch the replay of the special Technochasm broadcast I recently filmed with my InvestorPlace colleagues Eric Fry and Luke Lango. In it, we discussed the emerging, massive economic divide that’s being driven by AI’s explosive growth.

While most investors are focused on tariffs, we shouldn’t ignore the fact that the forces behind the Technochasm will be some of the most disruptive (but also profitable) opportunities of our lifetimes. And as you’ll learn from Luke today, one of those destructive forces is robotics.

Check out the replay of our event here. And now, over to Luke…

************

For years, artificial intelligence has been trapped behind screens, powering chatbots and crunching data. But the next big revolution in AI won’t just talk. It will walk, move, and workin ways very similar to us. 

I’m talking, of course, about humanoid robots. 

These creations are finally stepping out of science fiction and into reality, possibly poised to become the most disruptive AI advancement yet. From factory floors to elder care, these machines could easily reshape industries, redefine labor… maybe even challenge what it means to be human. 

But don’t just take my word for it. 

Everyone who’s anyone in the tech world is betting on humanoid robots being the next big AI breakthrough. Elon Musk, the world’s richest man, is certainly all-in on them. 

His firm Tesla Inc. (TSLA) has created a humanoid robot called Optimus, which is already being used inside Tesla factories to complete a variety of tasks. The company plans to ramp Optimus production to use them in its factories worldwide. It’s said that next year, it will start selling its robots to outside companies. And after that, it aims to offer them to consumers like you and me. We could soon have our own personal humanoid robot assistant in our homes, doing everything from unloading groceries and cleaning to safeguarding our house while we’re away. 

Clearly, Musk thinks humanoid robots are big business. In fact, on a recent Wall Street conference call, he said that he thinks “Optimus will be overwhelmingly the value of the company” with“the potential to be north of $10 trillion in revenue.” 

Those are bold statements. 

Yet, his bullishness on this breakthrough tech is not isolated. 

Big Tech’s Sweeping Bullishness

Meta (META) CEO Mark Zuckerberg is just as enthusiastic about a humanoid robot ‘takeover.’ 

He just created a new business unit within the company that is dedicated to the development of humanoid technology. Reportedly, Meta isn’t trying to create a full robot but, rather, an underlying software platform that robot-makers like Tesla can integrate into their bots. 

Meanwhile, Apple (AAPL) – the world’s largest company – has research teams within its own AI business that are working to develop robotics technologies. According to analysts, Apple is considering a range of robotics systems, from simple devices to complex humanoid machines, as part of a future smart home ecosystem where everything is automated. 

Alphabet (GOOGL) has also been investigating robotics technology and just invested in humanoid robotics startup Apptronik. 

NVIDIA Corporation (NVDA) just launched a new family of foundational AI models called Cosmos designed to help humanoid robots navigate the real world. 

OpenAI – maker of ChatGPT – is reportedly considering embarking on a humanoid endeavor.

And Microsoft (MSFT) has partnered with Sanctuary AI to build general-purpose humanoid robots. 

It seems the race is on!

And that means humanoid robots are coming soon – maybe to your very own home…

The Final Word on Humanoid Robots

Here’s the thing about Big Tech companies. They have enough money and talent that when they decide to do something, it is only a matter of time before they get it done. 

Nearly all have decided to tackle humanoid robots. They will get it done, likely within a few years. We could see ~$20,000 humanoid robots for sale on Tesla’s or Amazon’s websites by this decade’s end. These robots could be in millions of homes by the time 2030 rolls around. 

Clearly, the next stage of the AI Revolution has begun. (Check out our urgent broadcast on that here.)

That’s why I’m bringing your attention to Elon Musk and his AI robot, Optimus, today. 

I think it has the potential to profoundly change the world and go down in history as Musk’s greatest achievement. 

But this next stage of the AI Revolution is about much more than just robots.

This next phase is creating something my InvestorPlace colleagues, Eric Fry and Louis Navellier, and I call the Technochasm. It’s something we’ve been talking about for five years now.

See, there is a shift ripping through the economy – a split that will create a vast chasm between the haves and have-nots. The end result? The biggest wealth shift since the Industrial Revolution.

How you position yourself on the right side of the growing chasm is crucial. That’s where we come in.

Just last week, Eric, Louis, and I held an urgent briefing to share a groundbreaking AI announcement that could make or break investors moving forward.

Watch the replay to get the blueprint you need to follow if you want to make the most money possible in this next chapter of the Technochasm – before it goes offline at midnight ET tonight.

Regards,

Luke Lango

Senior Analyst, InvestorPlace

P.S. Louis here again. I know the market has been a bit sloppy today, folks. But hopefully, this afternoon’s tariff announcements will clear the way for the market to begin rallying.

Stay tuned for my thoughts tomorrow.

Editor’s note: “Humanoid Robots: Betting on the Next Big AI Breakthrough” was previously published in March 2025. It has since been updated to include the most relevant information available.

For years, artificial intelligence has been trapped behind screens, powering chatbots and crunching data. But the next big revolution in AI won’t just talk. It will walk, move, and work in ways very similar to us. 

I’m talking, of course, about humanoid robots. 

These creations are finally stepping out of science fiction and into reality, possibly poised to become the most disruptive AI advancement yet. From factory floors to elder care, these machines could easily reshape industries, redefine labor… maybe even challenge what it means to be human. 

But don’t just take my word for it. 

Everyone who’s anyone in the tech world is betting on humanoid robots being the next big AI breakthrough. Elon Musk, the world’s richest man, is certainly all-in on them. 

His firm Tesla (TSLA) has created a humanoid robot called Optimus, which is already being used inside Tesla factories to complete a variety of tasks. The company plans to ramp Optimus production to use them in its factories worldwide. It’s said that next year, it will start selling its robots to outside companies. And after that, it aims to offer them to consumers like you and me. We could soon have our own personal humanoid robot assistant in our homes, doing everything from unloading groceries and cleaning to safeguarding our house while we’re away. 

Clearly, Musk thinks humanoid robots are big business. In fact, on a recent Wall Street conference call, he said that he thinks “Optimus will be overwhelmingly the value of the company” with “the potential to be north of $10 trillion in revenue.” 

Those are bold statements. 

Yet, his bullishness on this breakthrough tech is not isolated. 

Big Tech’s Sweeping Bullishness

Meta (META) CEO Mark Zuckerberg is just as enthusiastic about a humanoid robot ‘takeover.’ 

He just created a new business unit within the company that is dedicated to the development of humanoid technology. Reportedly, Meta isn’t trying to create a full robot but, rather, an underlying software platform that robot-makers like Tesla can integrate into their bots. 

Meanwhile, Apple (AAPL) – the world’s largest company – has research teams within its own AI business that are working to develop robotics technologies. According to analysts, Apple is considering a range of robotics systems, from simple devices to complex humanoid machines, as part of a future smart home ecosystem where everything is automated. 

Alphabet (GOOGL) has also been investigating robotics technology and just invested in humanoid robotics startup Apptronik. 

Nvidia (NVDA) just launched a new family of foundational AI models called Cosmos designed to help humanoid robots navigate the real world. 

OpenAI – maker of ChatGPT – is reportedly considering embarking on a humanoid endeavor. And Microsoft (MSFT) has partnered with Sanctuary AI to build general-purpose humanoid robots. 

It seems the race is on!

And that means humanoid robots are coming soon – maybe to your very own home…

Trump’s goal with tariffs … is it working? … the stock market has turned “manic” … Goldman slashes its earnings forecast … your final day to get Louis’ AI picks

The hysterical financial media has promoted the narrative that these tariffs will be catastrophic for the U.S. economy – and that President Trump is hellbent on destruction.

Nothing could be further from the truth.

So says legendary investor Louis Navellier.

Let’s begin today by separating fact from fiction regarding President Trump’s trade war and tomorrow’s much-anticipated “Liberation Day.”

If “destruction” isn’t driving Trump’s tariff plans, what is?

Back to Louis:

This is all about leverage, plain and simple…

At the heart of it, Trump’s tariff strategy is two-fold:

1. Level the playing field– “What they charge us, we charge them.”
2. Encourage onshoringto avoid tariffs altogether.

Both goals are designed to strengthen the U.S. economy – and both are already working.

As one example of tariffs achieving their intended effect, Louis points toward Vietnam and the auto industry

Vietnam has the third-largest U.S. trade surplus after China and Mexico. And Louis notes that Trump tariffs are already achieving the desired outcome:

[Vietnam] has already responded.

It announced it would lower tariffs on certain U.S. products like liquefied natural gas and vehicles – a clear sign that countries are preparing to negotiate rather than retaliate…

This illustrates the “lowering their tariffs” part of the dual goal; let’s continue with the auto industry to highlight the “onshoring” aspect.

Back to Louis:

The EU is still hell-bent on net zero. So that’s why they want all-electric cars by 2035.

Well, if you’re sitting in Germany right now, you’re not making hardly any money, if any, on electric cars. All your money is made on cars with engines.

And Trump’s inviting you to come to America. He’s already said this, and he’ll give you the work visas for all your workers, and your electricity will be a quarter of the cost it is in Germany, and all these states will be throwing incentives at you to move, and you already have plants in America.

So, why don’t you just pick up and move? That’s what’s going on.

Of course, Trump’s tariff strategy isn’t limited to cars.

Louis notes that, altogether, $1.2 trillion in technology onshoring has already been announced. If pharmaceutical and auto companies follow suit, Louis believes that we could see several trillion dollars in new domestic investment.

Louis urges investors to resist the temptation to join the herd in panicking

We know what we’re supposed to do when market conditions turn nasty. We’ve heard the quotes like Warren Buffett’s, “be greedy only when others are fearful.”

But when you’re seeing your portfolio drop 5%… 8%… 14%… watching that translate into losses of thousands (or hundreds of thousands) of dollars, cool-headed logic is often overcome by emotion.

In moments like these, it’s helpful to take a page out of Louis’ playbook and shift our focus from portfolio values to earnings.

From Louis:

Remember, markets are manic. Wall Street has ignored a lot of great AI news lately.

On March 10, for instance, Taiwan Semiconductor Manufacturing Co. Ltd. (TSM) reported that February revenues had surged 43.1% to 260 billion Taiwan dollars.

This is a historically strong forward indicator for chip-designing firms like Arm Holdings plc (ARM) and NVIDIA Corporation (NVDA).

Now, forgetting ARM and NVDA for the moment, look at TSM.

Since that March 10^th announcement, TSM has fallen 2%. This is a continuation of its broader 25% pullback since late-January.

This could be a great long-term entry point.

As to Nvidia, regular Digest readers know that this is one of Louis’ favorite stocks.

He put his Growth Investor subscribers into it back in 2019. They’re sitting on open gains of 2,436% as I write Tuesday morning.

Despite its continued earnings/revenue strength over recent quarters, the stock has fallen 27% since the first week of January.

Remember, Louis has called Nvidia his “stock of the decade.” Might a 27% discount be something to consider?

Here’s Louis’ overall take:

[Despite AI earnings growth], investors have only focused on the negatives lately (mainly tariffs). The media only adds fuel to the fire in situations like this, because every setback in talks, and every ensuing pullback, is covered like it’s a full-blown crisis.

This has sent the prices of many world-class AI stocks into correction territory. As a result, we’re now facing a grossly oversold stock market where phenomenal companies like NVIDIA are trading at incredible discounts.

Stock markets are not rational calculating machines. Again, markets are manic.

“Manic market” or not, this does not mean that investors have a green light to go on an indiscriminate buying spree

I was on a call this morning with a handful of analysts from InvestorPlace and our corporate affiliate TradeSmith. The takeaway? This is a stock picker’s market.

While there are plenty of overhyped, overvalued stocks to avoid, some fantastic buying opportunities are available for investors who know where to look – and Louis is looking (and buying) today.

I’ll circle back to those details in a moment. But first, let’s look at why a broad “buy the dip” mentality is dangerous today.

In short, we’re at risk of bearish sentiment eventually broadening into bearish earnings.

In recent Digests, we’ve been highlighting the push and pull on a stock price that comes from two sources: earnings and sentiment.

In the short term, sentiment drives a stock’s price movement, but in the long term, earnings win the day.

Today, bearish sentiment has weighed on stock prices even though earnings forecasts are bullish.

So, if trade wars (and other market overhangs) affect sentiment only, then – eventually – today’s bearish sentiment will turn bullish, and stocks will roar higher as bullish earnings retake the spotlight.

Our hypergrowth/technology expert Luke Lango made this point in yesterday’s Digest:

If the trade war doesn’t heat up… and the economy doesn’t slow… then those earnings estimates will only keep pushing higher… and the current valuation discount will make no sense…

So, AI stocks should rebound strongly.

But if trade wars result not only in today’s bearish sentiment, but also in tomorrow’s weaker earnings, then Wall Street will have to recalculate stock prices across the board.

Not only would those calculations include today’s lower sentiment multiples (and likely, even lower ones), but they’ll also have to include new, lower earnings per share numbers.

That could be brutal for stocks.

To illustrate, over the weekend, Goldman Sachs released a research note updating their market projections. In a worst-case recession scenario, they see stocks falling ~50%.

This leaves us with a rough binary…

If we begin to see evidence that sentiment is turning bullish, that’s a buy signal for great stocks in this “stock picker’s” market.

But if we begin to see a strong case that earnings are weakening, that’s a “take caution” signal.

Well, circling back to Goldman, they just lowered their expectations for where the S&P will finish the year (now projecting a loss). And a big reason for this is earnings.

From Chief U.S. Equity Strategist David Kostin:

These estimates incorporate downward revisions to both earnings growth and valuations, reflecting a weaker base case economic growth backdrop, higher uncertainty, and higher recession risk.

Goldman lowered its 2025 price target for the S&P from 6,200 to 5,700.

Though that target is a little over 1% higher than the S&P’s price as I write, it’s about 4% lower than where we started the year.

Such a tepid broad market forecast amplifies the importance of investing only in fundamentally strong stocks. These companies tend to fall less in bearish markets and rebound faster/higher in bullish markets. Or, as Louis often puts it:

Fundamentally superior stocks bounce like fresh tennis balls.

And this brings us back to what Louis is investing in today, and what he recommends for investors:

With things still volatile and uncertain right now, how should you invest?

The answer is simple: Buy fundamentally superior stocks that bounce!

These are the stocks that hold up when the market gets choppy – and sprint ahead when things turn around.

For an illustration of such stocks, let’s rewind to last week

As we’ve been profiling here in the Digest, Louis, along with our other experts, Eric Fry and Luke Lango held a roundtable discussion centered on AI.

They provided a roadmap for how to invest right now, highlighting a small portfolio of elite AI stocks that they believe will be tomorrow’s market leaders. “Fundamental strength” is a core attribute.

Here’s Louis with earnings data on their top AI plays:

Of the 11 AI Revolution Portfolio companies that reported earnings last month, nine beat expectations, and another met forecasts.

As a group, these 11 firms posted 18% revenue growth and 24% earnings growth, and they are set to increase profits by another 77% by 2026. 

In comparison, the S&P 500 grew earnings 7.1% in the first quarter, while revenue increased 4.2%.

These are phenomenal numbers and serve as a reminder that great investment themes will outlast any market wobble. 

If you missed last week’s presentation, you can catch a free replay right here. Please note, it’ll only be available through tomorrow.

Wrapping up…

All eyes are on “Liberation Day” tomorrow.

Fortunately, Louis (and Luke) believe that while the market pain may not end tomorrow, we’ll begin the tariff clarification process that will result in the return of bullish conditions.

Back to Louis:

The fact is, once the April 2 “Liberation Day” deadline passes and the rules of the road are better understood, much of the uncertainty plaguing the market should fade away.

Clarity, optimism and strong corporate earnings – along with lower interest rates on the horizon – could give stocks the push they need to move higher.

We’ll report back tomorrow when Liberation Day details emerge.

Have a good evening,

Jeff Remsburg

Tantrum, hissy fit, meltdown… no matter what you call it, Wall Street had a very emotional reaction to the Trump 2.0 tariffs over the past few months.

The month of March capped off the worst month and worst quarter for the S&P 500 and NASDAQ since 2022. In the first quarter, the S&P 500 dropped 4.6%, while the NASDAQ plunged 10.4%. The Dow had a more muted fall, with a 1.3% decline in the first three months of the year.

Remember, the stock market is a manic crowd – it tends to react first and think later. So, the recent stock market correction was a gross overreaction to the Trump 2.0 tariffs and inflation fears.

I’ve actually been tracking the hysterical stories about how tariffs will cause inflation, and what I discovered is that the vast majority are from foreign sources. So, in today’s Market 360, we’re going to separate fact from fiction, and I’ll set the record straight about tariffs, inflation and slowing global growth. I’ll also share the stocks you can invest in confidently in this volatile market… and where you can find them.

Separating Fact From Fiction

Fact: The Trump 2.0 tariffs are meant to level the playing field.

President Trump has dubbed April 2 as “Liberation Day,” as reciprocal tariffs will be implemented to equalize U.S. tariffs. President Trump stated, “What they charge us, we charge them.”

The objective of the tariffs is to punish nations that have been serial abusers of using tariffs to protect their domestic industries and/or circumvent U.S. tariffs by using Mexico for subassembly. While President Trump did say on Sunday that the administration “would start with all countries,” he also noted that he “may give a lot of countries breaks.”

Now, two serial abusers are China and Mexico. It’s no secret that Mexico’s trade surplus has surged over the past several years. That’s because China has circumvented U.S. tariffs by doing subassembly in Mexico and importing goods under the cover of the North American Free Trade Agreement (NAFTA).

Another example is Vietnam. Vietnam has the third-largest trade surplus with the U.S., after China and Mexico. And in anticipation of the April 2 tariffs, Vietnam said it would cut tariffs on a few U.S. products like liquefied natural gas (LNG) and vehicles.

So, adjustments are happening, and new trade deals are being negotiated.

Fiction: Tariffs are inflationary.

While the foreign financial media has promoted the narrative that tariffs are inflationary, deflation has already emerged. In fact, China has reported widespread deflation in virtually all categories. Consumer prices fell into negative territory in February and wholesale prices have been stuck in negative territory for more than two years.

I should also add that the U.S.’s trade deficit has soared as goods were “dumped” in the U.S. to try to beat the impending tariffs. These excess goods are not expected to be discounted, and that could further spread the deflationary forces that have recently emerged.

So, the world economy is at risk of slipping into a deflationary spiral.

Meanwhile, inflation is cooling off here in the U.S. The Consumer Price Index (CPI) was unchanged in February and the Producer Price Index (PPI) declined. On the flip side, though, last Friday’s Personal Consumption Expenditures (PCE) index came in hotter than expected, mainly due to a more cautious consumer.

Headline PCE rose 0.3% in February and was up 2.5% in the past 12 months. Core PCE, which excludes food and energy, increased 0.4% last month and is up 2.8% in the past 12 months. Core PCE is the Federal Reserve’s favorite inflation indicator – and it clearly remains above the Fed’s 2% target. Economists’ estimates called for a 0.3% month-to-month rise and a 2.7% annual increase.

Also notable, consumer spending rose 0.4% in February, up from a decline in January. But that still fell short of expectations for a 0.5% increase. So, consumers remain cautious right now.

Overall, though, I don’t foresee the Trump 2.0 tariffs igniting inflation in the U.S.

Fact: The Trump 2.0 tariffs are set to encourage more onshoring.

President Trump has made it crystal clear that the German auto industry is welcome to move its manufacturing to the U.S. He’s noted that the U.S. offers cheaper electricity and labor costs, as well as less oppressive regulations.

Speaking of the latter, the European Union is still set to force the European auto industry to be 100% electric vehicles (EVs) by 2035. However, German auto manufacturers have not been able to make much money on EVs, so onshoring to the U.S. to make internal combustion engine (ICE) vehicles might be a strategic move for German automakers.

Interestingly, President Trump’s executive order last Wednesday to implement 25% tariffs on all imported vehicles, regardless of the country of origin, may push other automakers to explore expanding their U.S. manufacturing facilities.

In the meantime, $1.2 trillion in technology onshoring has already been announced. Apple Inc. (AAPL) and NVIDIA Corporation (NVDA) announced $500 billion and $100 billion, respectively, in onshoring projects in the U.S. And if more technology companies, as well as pharmaceutical and vehicle companies, onshore operations to the U.S., there could be several trillion in onshoring!

The reality is onshoring is the real goal of the Trump 2.0 tariffs – and you will not hear that from the hysterical foreign media.

Fiction: The U.S. is on the verge of recession.

As the recent earnings announcement season wound down and tariff mania took hold, the Atlanta Fed revised its Gross Domestic Product (GDP) forecast down. It now expects the U.S. economy to contract in the first quarter – and that rattled Wall Street.

The primary reason why GDP growth is forecast to be negative in the first quarter is due to a big trade deficit, which is because of all the dumping of imported goods and an increase in gold inventory. Speaking of the latter, gold surged 25% in February after soaring 43% in January, based on Comex stockpiles. The imports of gold from Switzerland have also soared to the highest level since 2012.

So, the trade deficit is now deducting a whopping 4% from first-quarter GDP growth. In other words, excluding the trade deficit, the U.S. economy is still growing.

I should also add that none of the economic tea leaves signal a recession. Both Treasury Secretary Scott Bessent and Federal Reserve Chair Jerome Powell recently stated that the U.S. economy is “healthy.”

The fact is there have been some positive economic reports recently: the strongest factory goods orders report in a year and a surprising jump in existing home sales. Furthermore, the Institute of Supply Management (ISM) posted positive readings for its manufacturing and service sector PMIs.

Also, as we just discussed, the Trump administration is soliciting trillions in onshoring. If successful, that should boost GDP growth. So, the U.S. is not at risk of falling into a recession.

Fact: More respectful trade talks have ensued.

One of the biggest trade agreements the U.S. has is the United States-Mexico-Canada Agreement (USMCA). This went into effect under Trump 1.0 in July 2020. The agreement is set to expire in 2026, and Trump 2.0 wants the USMCA to be the “fairest, most balanced and beneficial trade agreement we have ever signed into law.”

Interestingly, President Trump recently praised Mexican President Claudia Sheinbaum, which is a positive development. Another positive development is that Commerce Secretary Howard Lutnick has had some success negotiating with Ontario Premier Doug Ford, as he lifted the proposed 25% tariff on hydroelectric power.

The new Canadian Prime Minister, Mark Carney, also recently stated that Canada can only go so far in responding to the new import taxes imposed by the U.S., given the mismatch in size between their respective economies. So, Carney said, “We are not trying to organize coordinated retaliation.”

This is a positive sign that the tariff debate has moved behind closed doors, with Lutnick and other trade representatives sitting down to negotiate. In other words, cooler heads are prevailing, and new trade agreements are anticipated.

The Bottom Line

It’s not always easy to separate fact from fiction, especially when Wall Street reacts to every headline and stocks are spiraling lower. But I hope that our closer look at the Trump 2.0 tariffs and their impact on inflation and the U.S. economy helps set your mind at ease.

The reality is that the Trump 2.0 tariffs are largely about settling trade imbalances and pushing foreign corporations to increasingly onshore to the U.S. – all of which should ultimately boost the U.S. economy.

So, despite the continued tariff distractions, the U.S. is now in the midst of an economic renaissance. Economic optimism should steadily rise following “Liberation Day” tomorrow – and continue to rise in the upcoming months.

Positive economic optimism coupled with continued strong corporate earnings and lower interest rates should serve as a powerful one-two-three punch that propels economic growth dramatically higher. And that should also translate to higher stock prices.

So, I continue to encourage you to tune out the noise and focus on the facts. And don’t let the uncertainty or market volatility scare you out of the market either. I am confident that in the end, when all the dust settles, companies that have very strong sales and earnings will lead the market higher.

I expect my Growth Investor stocks to be among the leaders, as they remain backed by 22.4% average annual sales growth and 79.4% average annual sales growth. Plus, the analyst community has increased earnings estimates 4.4% higher for my average Growth Investor stock in the past three months. So, the analyst community remains very positive on my stocks.

In other words, those who follow my Growth Investor stocks can invest confidently. These are the stocks that exhibit tremendous relative strength and begin to rebound quicker than most.

If you’d like to view my Buy List stocks, join me at Growth Investor. You’ll also have full access to my Special Market Podcasts, special reports, and past Weekly Updates and Monthly Issues. I’ll be releasing a new Special Market Podcast tomorrow to review the tariffs and the market’s response. While I will cover Liberation Day in Thursday’s Market 360, if you want my first thoughts on Wednesday, sign up for Growth Investor today.

Sincerely,

Louis Navellier

Editor, Market 360

P.S. Wall Street may be focused on tariffs right now, but we can’t forget what will really disrupt the market: artificial intelligence. For the past few years, my InvestorPlace colleagues, Eric Fry and Luke Lango, and I have been warning about a massive technological divide we call the “Technochasm” – and our predictions have proven alarmingly accurate.

Now, we’re sounding the alarm about an even more dramatic acceleration of this trend, driven by AI’s explosive growth. But if you position your portfolio correctly, you can not only protect yourself from this divide but potentially profit enormously from it.

We just issued urgent buys on six stocks that could surge in the coming weeks and months, as AI enters its destructive phase. You can learn more about how this will all play out in the markets and the names of these six stocks by watching this time-sensitive video. But please watch soon, because this video will be taken offline tomorrow at midnight. Click here to watch it now.

The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

NVIDIA Corporation (NVDA)

Welcome to the ultimate Tariff Week, folks – perhaps the most dramatic episode of global economic theater since 2020’s COVID lockdowns began. 

Tomorrow, Wednesday, April 2 is the big one: now known across trading desks as “Liberation Day.” That’s when U.S. President Donald Trump is expected to drop the hammer with a sweeping new set of tariffs that could restructure the entire global economic order.

Naturally, investors are nervous right now. And who can blame them?

The numbers tell the tale. The S&P 500 has cratered more than 10% from its all-time highs. The Nasdaq is down roughly 15%. And the Russell 2000? It’s flirting with a 20% nosedive.

That makes this the biggest market correction since 2022. And while volatility isn’t exactly a stranger to Wall Street, this one hits differently… 

Because it’s not about interest rates, earnings misses, or some overhyped AI stock that turned out to be smoke and mirrors.

This is about the fundamental rules of global commerce being redrawn in real time.

The Tariff Toll on Markets

If you’ve been watching the markets over the past month, you’ve basically been locked into an emotional hypercoaster – with no safety harness.

It started back in February, when Trump floated the idea of universal tariffs on all countries and triggered a sharp leg down in stocks. Investors braced for a full-scale global trade war.

Then came the walk-back.

By mid-to-late March, the narrative had shifted to more “surgical” trade policy: targeted tariffs on the “Dirty 15” – the 15 countries with which the U.S. runs its largest bilateral trade deficits. That shift was enough to spark a brief but powerful relief rally, as cooler heads seemed poised to prevail.

But now? Here we go again.

Over the weekend, reports began circulating that Trump’s team was reconsidering the idea of blanket tariffs on all countries. This messaging unravelled the prior “targeted” narrative and sent markets plunging back to the March lows. It’s been a nonstop whiplash cycle of panic, hope, panic again; and no one knows what to believe anymore.

All these violent swings have left stocks in a very precarious – or maybe promising – technical situation… 

What’s to Come on Wednesday

The S&P 500 has officially broken below its 250-day moving average for just the second time since this AI-fueled bull market began. That level has acted as the market’s trampoline in the past. But when it breaks? Things tend to go from bouncy to bloody in a hurry.

Historically, dips to this level result in one of two outcomes:

1. A monster rebound rally that leaves short sellers in the dust; or
2. The beginning of a true bear-market meltdown.

This is a technical tipping point. And with “Liberation Day” looming, the fundamentals are about to either validate or obliterate the charts.

So, with all this volatility, uncertainty, and tariff brinkmanship… are we panicking?

Not quite. 

We still think Liberation Day won’t be nearly as bad as feared. Our take? Trump’s threat of universal tariffs is mostly bluster – an opening chess move, not checkmate.

Our base case remains:

• Tariffs will be targeted, not universal.
• The Dirty 15 get hit, but not the world at large.
• And once the dust settles, fast-and-furious negotiations will begin.

As painful as tariffs are for the U.S., they’re even more devastating for just about every other economy involved. Europe, Canada, South Korea, Japan – they have more to lose; and they know it.

These nations have significant export sectors, and a large portion of their GDP comes from trade. The U.S. also has a more diversified set of trading partners than many of these countries do. So, if tariffs are imposed on a particular country, it would likely be harder for it to replace lost business with the U.S. market.

That’s why we expect rapid deals, quick walk-backs, and a broader deescalation through April.

In other words, we’ve reached the climax of this trade war drama.

After two years of strong performance, the stock market has struggled here in 2025. Paired with economic data that has surprised to the downside, the threat of a global trade war has weighed heavily on Wall Street. 

And it could all come to head just two days from now, on Wednesday, April 2 – what U.S. President Donald Trump is calling “Liberation Day.” 

That’s when Trump is set to announce a set of sweeping reciprocal tariffs against America’s biggest trading partners. And depending on their severity and longevity, they have the potential to fundamentally reshape the global economic landscape. 

Some think the tariffs are simply a negotiating tactic for the U.S. to strong-arm its way into better trading deals. Others think they could remain in place to help grow the nation’s depleted coffers. 

And the truth is that no one really knows. 

Indeed, as Yahoo Finance’s Ben Werschkul pointed out, “The vastness of possibilities appears to be widening after Trump recently teased that he ‘may give a lot of countries breaks’ and said Sunday night he could be ‘generous’ even as he quickly added that ‘all countries’ could be impacted. A campaign trail idea of blanket 20% across-the-board tariffs also appears to have reemerged as at least an option.”

Even National Economic Council Director Kevin Hassett told Fox News that he couldn’t give “any forward-looking guidance on what’s going to happen this week.”

An overwhelming amount of uncertainty continues… Can’t say we’re surprised. 

However, one thing we know for certain is that these tariffs – regardless of if they have staying power – will create enormous stock market volatility. 

Just look at what has happened in the last month…

The Trade War Has Weighed on Wall Street

On Feb. 1, 2025, Trump issued executive orders announcing tariffs on Canada, Mexico, and China, to go into effect on Feb. 4. This started the trade war drama that persists today. 

Since then, hardly any of the tariffs he has threatened or issued have stuck around, save a few against China. Still, the markets have tumbled. 

The S&P 500 dropped more than 10% from the middle of February to the middle of March. The Nasdaq fell almost 15%, and the Russell 2000 crashed nearly 20%. Collectively, the “Magnificent 7” tech stocks dropped more than 20%. 

Tariff uncertainty alone has created massive market volatility. 

The uncertainty could intensify this week on April 2, when Trump enforces even more – potentially even larger – tariffs. 

And if this trade war drama persists beyond that day, the market will keep reacting violently. 

Huge crashes when tariffs are announced; huge rebound rallies when they’re paused. Another big selloff when more tariffs come, then another big rebound when those tariffs are delayed…

Lather. Rinse. Repeat. 

Hello, Reader.

Life can be filled with anomalies.

A white puppy is born into a litter of brown siblings. Snowfall blankets the Florida Panhandle. That one Monday when Garfield was happy.

Anomalies happen in the stock market, too.

As it happens, a short-term anomaly has developed in the natural gas market: Gas prices are rising, but natural gas stocks are falling. The chart below tells the tale.

Tumbling crude oil prices probably deserve most of the blame for causing this rare divergence.

For starters, falling crude prices cast a pall over the entire fossil fuel sector. In addition, most major natural gas producers also produce significant volumes of crude oil.

As a result, the shares of almost every North American natural gas producer have been sliding lower, no matter how little crude each company produces.

The First Trust Natural Gas ETF (FCG) is a perfect case-in-point. Its price has gone nowhere during the last two months, even though the natural gas price has jumped around 35% over that brief time frame.

Sooner or later, natural gas stocks should begin to reflect the strong pricing in the natural gas market and the bullish trends underway there. U.S. natural gas in storage, relative to seasonal three-year average levels, has been dropping sharply for nearly a year.

The most recent reading showed storage levels 14% below average levels for this time of year.

Against this backdrop, U.S. natural gas demand is on track to surpass supply by a wide margin over the next two years, which should reduce stockpiles even further below three-year average levels.

Our nation’s rapidly growing LNG (liquified natural gas) export capacity will account for most of the demand growth. The U.S. became the world’s biggest LNG supplier in 2023, surpassing Australia and Qatar.

In February, the amount of gas flowing to the eight big U.S. LNG export plants rose to a record-high 15.6 Bcf/d (billion cubic feet per day), as new units at Venture Global’s 3.2-Bcf/d Plaquemines LNG export plant in Louisiana entered service.

So far this month, LNG export volumes are even higher.

Looking down the road, the U.S. Energy Information Administration (EIA) predicts LNG exports will grow by 2.1 Bcf/d and an additional 2.1 Bcf/d in 2026, due to new export facilities that will begin operating during that time frame. Assuming this LNG demand materializes as the EIA expects, it would account for a whopping 72% of the entire country’s expected demand growth in 2025 and 2026.

Unlike domestic demand spikes that occur during exceptionally cold winters or hot summers, LNG export demand is relatively constant. Once in place, it remains in place and continues to consume domestic gas supplies, no matter what national weather conditions might be.

As such, this source of demand puts continuous upward pressure on natural gas prices, especially if domestic gas production fails to keep pace.

The EIA is predicting that exact scenario. Although the agency expects domestic production to increase by 3.6% during the next two years, that figure is well below the 5.8% demand growth the agency predicts.

This widening supply-demand imbalance would reduce U.S. gas inventories, which would be unequivocally bullish for natural gas prices.

My newest Fry’s Investment Report play on natural gas is already reaping rewards from improving natural gas prices in the Permian Basin of West Texas… although the company’s still-depressed share price does not reflect that potential.

At less than eight times earnings, its share price seems substantially undervalued, relative to both its peer group and to its “hidden” earnings potential from its holdings in the Delaware Basin chunk of the Permian.

But all that means is that this company currently offers a great buying opportunity.

Bottom line: U.S. natural gas is “Buy,” which means this natural gas play is a “Strong Buy.”

For more, click here to learn more about becoming a Fry’s Investment Report member today.

Now, let’s look at what we covered here at Smart Money this past week…

Smart Money Roundup

This ‘AI Divide’ Creates a Once-In-a-Generation Opportunity – Which Side Will You Land On?

The tech world is splitting in two due to AI, creating stark contrasts between those who adapt and those left behind. While execs pop Champagne as AI turbocharges stocks and mints new fortunes, others watch their careers vaporize overnight. Read on as Luke Lango digs deeper into how exactly artificial intelligence is widening the gulf between the haves and the have nots.

The Biggest Wealth Shift of Our Lives Is Coming – Here’s How to Prepare

As AI transforms industries, a stark divide emerges between adaptive and stagnant companies. Drawing parallels to past technological disruptions, businesses are leveraging AI to dramatically reduce workforce while increasing efficiency. Louis Navellier is here to share why this shift is happening, and how to prepare for it.

The 5-Letter Word Every Investor Should Memorize to Win in 2025

Investors are feeling frustrated, with bearish sentiment shooting up and many tech stocks taking a beating. But the broader stock market paints a different picture: A quiet shift is happening as forgotten value stocks start to steal the spotlight. Tom Yeung explains why market uncertainty is reshaping investment strategies.

Bill Gates Says You Might Be Obsolete Soon – Here’s What to Do About It

Spring cleaning forces us to confront obsolete tech – those dusty drawers filled with ancient phone chargers and forgotten gadgets. Bill Gates warns us humans might join this obsolete list, predicting AI will soon handle things like medical advice and tutoring without us. In this issue, I’ll take a look at the rise of physical AI and how one company is leading the charge.

The stock market currently resembles Disney’s Tower of Terror ride – a seemingly endless plummet that’s actually shorter than it feels. Recent market volatility, triggered by tariff tensons, has investors experiencing stomach-dropping fear despite limited actual losses. Learn more about the five steps Louis Navellier wants you to take to protect your portfolio.

Looking Ahead

While I have my eye on the natural gas market, I am also keeping my focus on the biggest trend of our time: artificial intelligence.

AI has been the biggest wealth driver in the stock market over the last two years, minting over 500,000 new millionaires.

But for all its promise, AI also has a dark side – one that could shock the financial system. 

My InvestorPlace colleagues Louis Navellier and Luke Lango and I have been talking a lot about the “Technochasm,” a phenomenon I’ve been tracking for the past five years. It refers to the deep divide that technology is creating within the market and society.

On one side of the gap are the companies (and investors) who leverage rapid technological innovation. On the other: investors and businesses that get caught off guard and fall behind.

Well, AI has come along and lit a match under the Technochasm. And this divide is now nearing the point of being uncrossable.

That is why I recently held an important broadcast with Louis and Luke to explain exactly how this massive capital shift will create the next generation of tech millionaires – and leave millions of others behind.

If you want to learn more about this opportunity – and the six stocks at the center of it – click here to access the free replay.

Regards,

Eric Fry

What tariff path will Trump take? … Luke expects tariff drama to pass quickly … how big the reversion rally could be … the AI stocks Luke, Louis, and Eric like today

Wednesday brings “Liberation Day.”

This is what President Trump is calling April 2, the day he plans to unveil his master reciprocal tariff plan, or “the big one.”

From Trump:

This is the beginning of Liberation Day in America.

We’re going to charge countries for doing business in our country and taking our jobs, taking our wealth, taking a lot of things that they’ve been taking over the years.

They’ve taken so much out of our country, friend and foe. And, frankly, friend has been oftentimes much worse than foe.

According to a White House memo, the new tariffs will be tailored for each U.S. trading partner. The aim is to counteract the tariffs imposed on American goods as well as other factors that may disadvantage U.S. manufacturers (such as regulations, value-added taxes (VATs), and weak intellectual property protections).

Since Trump announced these tariffs, there’s been tremendous speculation…

Is the tough talk primarily negotiating leverage? If not, how severe might the tariffs be? Is Trump willing to throw the economy and stock market under the bus to achieve his tariff goals?

Last week, our hypergrowth/technology expert Luke Lango, editor of Innovation Investor, highlighted the three most likely ways that tariffs could manifest:

• Trump could match other countries’ tariff rates by closing the tariff rate differentials
• He could slap them with new tariffs equal to their respective VAT rates
• He could go after non-tariff measures – things like sanitary standards, quotas, licensing obligations, and more – with new tariffs

What’s the likelihood of each avenue, and what could it mean for our economy?

Here’s Luke:

The first option – matching tariff rates – seems very likely and won’t do a ton of damage. It will increase the average tariff rate by 1-2 points, barely hit GDP growth, and barely raise inflation.

The second option – attacking the VATs – seems probable and would do a lot more damage. It would increase the average tariff rate by a little more than 10 points, would hit GDP by almost 2 points, and would raise inflation by about a point.

The third option – going after non-tariff measures – seems unlikely but would inflict serious pain. It would increase the average tariff rate by nearly 30 points, would hit GDP by 4 points, and would spike inflation by 2-3 points.

In that scenario, the global economy would plunge into a recession.

But if only options 1 and 2 are enacted – and they are temporary – then the economy could avoid a recession. That’s why [this] week – and the few weeks thereafter – are so important.

Why Luke believes the tariff drama will resolve soon

Luke believes the White House is clearly ready and willing to play “hard ball” in this global trade war.

Trump appears unaffected by his detractors, as well as the growing forecasts of an economic slowdown that would fall directly at his feet.

But Luke urges investors not to get caught up in the pessimism. He forecasts a different outcome:

Despite all the intense and hostile rhetoric out there right now, everyone will rush to the negotiating table to quickly strike new trade deals in April.

Within the first two weeks of April, we expect most countries to reach an agreement with the U.S. that results in the repeal or prolonged delay of most tariffs. 

Consequently, we believe that most of these tariffs won’t last more than a few weeks and that by late April, most of this tariff drama will be in the rearview mirror. 

Once the tariff drama moves into the rearview mirror, recession fears will abate, consumer confidence will rebound, economic activity will restrengthen, and the stock market will soar. 

Luke admits that Trump could prove him wrong. If so, and a significant trade war rears its ugly head, then investors would need to adopt a defensive posture.

But for now, Luke gives the benefit of the doubt to cooler heads prevailing.

How to play a short-term tariff storm

If you read Luke regularly, you know the answer…

Buy leading AI/technology stocks that have taken a beating since mid-February.

To make his case, Luke points us to the Bloomberg Artificial Intelligence Aggregate Equal Weight Total Return Index, calling it “the best comprehensive measure of AI stocks in the market.”

It includes a wide array of AI stocks, from little players like Astera Labs (ALAB) and Celestica (CLS) to big players like Nvidia (NVDA) and Microsoft (MSFT).

Luke writes that, last week, it hit “major bottom” levels.

As you can see below, it crashed to lows not seen since late-2022.

Back to Luke:

[The AI Index] is trading at its cheapest valuation since the AI Boom got started in late 2022 (21X forward earnings).

It has dropped to its ultimate technical support level (the 250-day moving average) which it has largely preserved throughout the whole AI Boom.

So long as the economy sidesteps a recession, this should be the bottom of AI stocks before they rally big into the summer. 

How much could these stocks rally?

Luke writes that after that late-2022 low, AI stocks have largely traded between 24X and 30X forward earnings, with an average forward earnings multiple of 26X.

Since the index now trades at 21X forward earnings, a return to 26X forward earnings would mean a 20% – 25% gain from here.

Don’t forget to factor in strong earnings

In recent Digests, we’ve highlighted that sentiment is the primary driver of a stock’s price in the short-term. According to Morgan Stanley Research, for durations of one year or less, sentiment is responsible for nearly 50% of a stock’s movement.

However, in the long-run, earnings are the true driver. The longer the duration, the greater the link between earnings and price. For example, according to that same Morgan Stanley Research, after 10 years, earnings account for 74% of a stock’s movement while sentiment drives just 5% of it.

Luke points out that AI earnings forecasts are continuing to climb despite the sentiment-driven selloff – creating a tailwind.

Back to Luke:

While AI stocks have crashed over the past few months and are now trading at essentially two-year low valuation levels, profit estimates on those same AI stocks have continued to push higher.

This could help drive a stock rally even further.

But this also sets up a critical binary that we’ve highlighted in recent Digests…

The binary – resulting in a stock market boom or bust – boils down to how this tariff drama resolves… which will drive the outcome of today’s battle between bullish earnings versus bearish sentiment.

Here’s how Luke describes the binary, along with his forecast for its resolve:

AI stocks remain fundamentally strong. They are dropping due to fear of what may happen to those earnings estimates if the trade war heats up and the global economy slows.

But… if the trade war doesn’t heat up… and the economy doesn’t slow… then those earnings estimates will only keep pushing higher… and the current valuation discount will make no sense…

So, AI stocks should rebound strongly. 

Last week, Luke, along with Louis Navellier and Eric Fry, provided a roadmap for how to invest in AI

The presentation was especially timely given the discounted entry prices on top-tier AI stocks we’re seeing today due to negative market sentiment.

At the event, our three experts discussed the emerging divide between the “haves” and “have nots” in the market and in our society. One of the most influential factors behind this growing divide is wealth generated from cutting-edge technology and artificial intelligence, something our experts have coined, “The Technochasm.”

This isn’t the first time that Luke, Louis, and Eric have urged investors to recognize the Technochasm and invest accordingly.

Here’s Luke:

We called the Technochasm in 2020. So, believe us when we tell you that this is a chasm that companies and individuals either leap across or fall into. There is no middle ground.

Those who listened to us in 2020 banked ~1,350% from Freeport-McMoRan Inc. (FCX) in 11 months, ~1,000% from Nvidia (NVDA), and upward of 1,200% from Fulgent Genetics Inc. (FLGT) in under two years.

Peanuts, maybe, compared to what’s ahead.

For investors, this creates a once-in-a-generation opportunity.

In their presentation last week, Luke, Louis, and Eric detailed three critical steps you must take now to stay on the right side of this growing tech divide.

They also explained how a trillion-dollar flood of money could soon surge into AI, thanks to moves by President Donald Trump. And they spotlighted some of the stocks poised to dominate the Technochasm.

If you missed it, we encourage you to check out a free replay right here.

Coming full circle…

Everything we’ve discussed today points us back to Wednesday and “Liberation Day.”

Will we be liberated from tariff fears and the recent market correction?

Or will heavy-handed tariffs panic Wall Street, causing the market to continue “liberating” us from all the gains we’ve enjoyed in recent years?

We’ll find out.

Have a good evening,

Jeff Remsburg

Well, folks, it is the last day of the first quarter of 2025. And it is safe to say it has been a rocky quarter. Over the last three months, the S&P 500, the Dow and the NASDAQ have lost 6.2%, 7.1% and a whopping 12.2%, respectively.

So, in the latest Navellier Market Buzz, I discuss the culprit for all of this uneasiness: tariffs.

Specifically, I touch on why Wall Street is feeling uncertain about Trump’s announcement regarding Wednesday, April 2 – aka “Liberation Day” – when reciprocal tariffs against U.S. trading partners are expected to be announced.

Now, in addition to the tariff announcement, we’ll also get some crucial economic data this week. So, I also previewed the upcoming Institute for Supply Management (ISM) Services Purchasing Managers’ Index (PMI) report on Thursday – and whether investors can expect to find any signs of hope. I also gave my take on the upcoming jobs data. In short, if the labor market shows signs of weakness, it could encourage the Federal Reserve to cut key interest rates.

Plus, I shared my thoughts on a handful of our stocks as well as fielded some of your excellent questions.

Click the play button below to watch now!