#MarketPullback Tariff Uncertainty and Trade Tensions**

President Trump’s aggressive tariff policies, targeting imported goods, have rattled markets. The S&P 500 fell over 10% in two days following the April 2 announcement, with small-cap stocks entering bear territory (declines >20%). Companies like Apple warned that tariffs could cost them $900 million in quarterly revenue, amplifying fears of squeezed margins and reduced consumer spending.

2. **Federal Reserve Policy and Interest Rates**

The Fed’s delayed rate cuts and hawkish stance on inflation reduced liquidity, while Japan’s first rate hike in 17 years disrupted global carry trades, triggering a sell-off in risk assets like U.S. stocks.

3. **Valuation Concerns and Over-Optimism**

Elevated investor sentiment, as seen in the Investors Intelligence Bull/Bear Ratio (3.9) and record consumer confidence, signaled overbought conditions. The S&P 500 traded 11.2% above its 200-day moving average in December 2024, a classic contrarian warning. $BNB

4. **Sector-Specific Vulnerabilities**

Technology and consumer discretionary sectors, reliant on global supply chains, were hit hardest. The Russell 2000 small-cap index fell >20%, reflecting challenges in a high-rate environment