3 Things You Need to Know This Week | Tariffs & Inflation, Q1 Earnings and US Tax Day (Apr. 7, 2025)

Transcript

Ben Thistlethwaite:

Hello, and welcome to 3 Things You Need to Know this Week. This is our regular series designed to help you sift through the noise across financial media and better understand what really matters for markets.

And now, here are the three things you need to know this week:

First up, US tariff fears and inflation.

Last week's tariff related volatility has many investors spooked. And while we're monitoring closely, we wouldn't currently recommend any knee jerk portfolio changes. Even if last week's tariffs are implemented in full, trade negotiations and time likely soften the real impact. Plus, businesses have consistently found ways to limit tariffs impact on consumer prices. And with over 70% of US GDP tied to services which aren't directly hit by these tariffs, we think the bigger driver of inflation remains money supply. Money supply is growing at a nicely stable pace. We appreciate market volatility is uncomfortable, and it wouldn't be overly surprising to see more volatility ahead. But in our view, discipline and patience are most critical during times like this. This still looks more like a short-term correction to us, than the start of something much worse. So we think that patients will pay off here.

Next up, Q1 earnings.

Earnings season kicks off this week and on Friday, some of the biggest names in banking and finance will report their first quarter results. Analysts are forecasting a 4.2% rise in sales and a 7.3% jump in earnings for the S&P 500. And that's all compared to last year. Within that, healthcare and technology are expected to lead the charge, though growth is predicted across most sectors. If these numbers hold, it would mark the seventh straight quarter of earnings growth. But here's the thing to remember, markets don't just react to earnings results. They're looking ahead. Stocks often move well before the numbers are out. So, while these reports are important, the bigger picture of where the market may be headed relies on a whole host of other global economic factors all around the world, including political developments and the broader overall trends in investor sentiment. If you're a long-term investor, tracking Q1 earnings and sector growth can certainly help you spot industries with strong potential. But staying aware of trends in broader market drivers can help you really adapt your portfolio over time.

Finally, US tax day.

Tax day is just around the corner. April 15th, 2025 is the deadline to file most individual trust estate or gift tax returns for the 2024 tax year. Need more time? You can request an extension for filing until October 15th. But importantly, remember an extension only applies to filing your return, not paying what you owe. In order to avoid penalties or interest charges, make sure any taxes due are paid by the April deadline. Feeling like you're paying too much? Now's your chance to make deductible contributions, if eligible, to an IRA or a health savings account for the prior tax year. Thinking ahead? April 15th is also the deadline to make Roth IRA contributions for the prior year, helping you plan for future tax savings. And if filing feels overwhelming, you're not alone. Consider speaking with a tax professional to guide you through the process and to help you make decisions that work well for your unique financial situation.

And that's it for this episode of 3 Things You Need to Know This Week.

For more of our thoughts on markets, check out This Week in Review that's released every Friday. You can also visit FisherInvestments.com. Thanks for tuning in, and don't forget to subscribe!