Fresh news and strategies for traders. SPY Trader episode #1137. Hey there, Spy Traders! It's your pal, Penny Pincher, here with your midday market update. It's 12 pm on Friday, May 2nd, 2025, Pacific Time, and things are moving faster than you can say 'bull market'! Let's dive into the news that's shaping your investments. So, US stocks are up, mainly because the jobs report was better than expected. We added 177,000 jobs in April which is way above the 130,000 predicted. This has calmed some recession fears, with the S&P 500, Dow, and Nasdaq 100 all climbing over 1.5%. In fact, the S&P 500 and Dow are trying to stretch out a nineday winning streak. Despite this recent rally, the US500 is still down about 3.2% since the start of the year, so let's keep our expectations realistic. Looking at sectors, it's mostly green across the board. On May 1st, healthcare and consumer staples didn't do so hot, but tech and communications stocks were the MVPs. Telecom services are leading the pack today, up over 2%, followed by realty at just over 1%. Oil and gas is inching up, while sectors like consumer goods are actually down a little bit. Remember yesterday Apple fell 5% after suggesting tariffs will hurt earnings this year, Amazon fell 1% due to weakerthanexpected guidance, Exxon Mobil and Chevron shares are up nearly 2% after posting their results. Microsoft and Meta reported banger firstquarter results. Oh, and Jeff Bezos is planning to sell almost $5 billion of Amazon stock, which could be interesting. Now, for the notsosunny stuff. Stagflation worries are popping up. Our GDP shrank by 0.3% in the first quarter, the first time since 2022. This is being blamed on a jump in imports because of upcoming tariffs. And inflation? Still accelerating. The Personal Consumption Expenditures price index is up 3.6%, with the core rate above the Fed's 2% target. Also, unemployment is up a bit, and manufacturing is looking a little weak. President Trump's tariffs are still a big headache, messing with supply chains and making everyone nervous. Initial jobless claims rose more than expected, but they're still below average, so not time to panic yet. So what's the deal? The jobs report is great, but the GDP drop and inflation are red flags. The jobs numbers might be inflated by companies stocking up before tariffs hit. Tariffs are clearly hurting, causing inflation and uncertainty. The risk of stagflation is real, which would be a tough spot for the Fed. All this means we can expect some market swings. Here’s a little market humor. A stockbroker told his client, 'I have great news! We've been doing really well recently. Our portfolio is up 177 points!' The client replied, 'That’s wonderful, but I’m not sure what those numbers mean.' So the broker explained, 'It's like this: imagine a big cake that represents our investments. We had a slice, and now it's a slightly bigger slice because of the good jobs report today, even though the whole cake might be shrinking a little elsewhere due to some economic concerns. But we're still getting more frosting from sectors like technology!' The client smiled and said, 'Okay, as long as my piece of the cake keeps getting bigger, I’m happy!'. What to do? Diversify, my friends! Spread your investments around to cushion the blows. Be cautious with growth stocks, especially those vulnerable to tariffs. Value stocks might be a safer bet right now. Keep an eye on what companies are saying about the future, especially about tariffs. Stay updated on the economy and what the government is doing. Consider defensive sectors like consumer staples and healthcare. Maybe look at investments that do well with inflation, like commodities or real estate. Most importantly, don't panic and think longterm. And hey, talk to a financial advisor to get advice tailored to you. That's all for today, folks! Stay safe, trade smart, and I'll catch you next time!