Odds Of New Highs For Stocks Increasing | Lance Roberts

Technical indicators reset from overbought levels

Momentum indicators and relative strength have worked off excessive overbought conditions since November, reloading bullish support for the market.

GDP weakness offset by strong consumer spending

Weaker-than-expected GDP data paired with robust personal consumption eased recession fears and supported earnings growth expectations.

Capital rotating back into mega-cap tech

Money flows are returning to beaten-down technology leaders including Google, Meta, Amazon, Apple, and Nvidia, which are driving market gains.

IEEPA struck down but alternatives exist

While the Supreme Court ruled against tariffs imposed under the International Emergency Economic Powers Act, the administration can maintain 15% tariffs through 180-day renewal frameworks.

Markets rallied on capped uncertainty

The market welcomed the ruling because it potentially caps maximum tariff rates at 15% for some countries while trade uncertainty had already been priced in.

Collected revenue unlikely to be refunded

The ruling creates legal questions about tens of billions in monthly tariff revenue already collected, though repayment appears politically improbable.

Tariffs achieved negotiating objectives

The tariff strategy successfully secured restructured trade deals with major world economies, serving as the necessary leverage for negotiations.

Geopolitical deterrent power diminished

Threatening 100% tariffs against Iran and other nations becomes legally challenging without congressional approval under remaining tariff authorities.

Iran tensions surpass trade as volatility risk

Potential disruptions to the Strait of Hormuz and escalating tensions with Iran pose greater near-term market volatility risks than trade policy.

Filibuster elimination remains unlikely

Despite pressure to eliminate the filibuster to cement executive actions before midterms, the long-term political risk of simple majority rule prevents this nuclear option.