Everyone Says to Buy the Dip, Even the White House: Taking Stock

(Bloomberg) -- S&P 500 futures are seeing a slight bounce after a brutal selloff while the VIX remains elevated at ~23. We clawed back late in yesterday's session to end a shade above the February closing low of 2,581 -- this may be the new support to watch after we closed below the 200-day moving average for the first time in almost two years.

Things to be aware of today include more tit-for-tat rhetoric in regard to China's response on tariffs, Trump reportedly pushing for a preliminary Nafta deal at a summit next week, and a Vanity Fair article citing sources that say Trump is looking at ways to escalate his tweet-slams on Amazon -- "He's off the hook on this. It's war." -- advisers are reportedly encouraging Trump to cancel AMZN's multibillion-dollar contract with the Pentagon to provide cloud computing services.

Sell-siders are out with some big calls this morning, including JPMorgan strategist Mislav Matejka recommending to buy stocks here, analysts recommending buying INTC on yesterday's weakness (see Street Wrap), AMZN (-0.5% pre-market) defended at Piper, NVDA (+1.5% pre-market) replaced FB on US1 List at BofAML, X (+1.7% pre-market) upgraded to buy at Citi, and JPMorgan questioning GE's credit rating (+0.5% pre-market) and also recommending crash puts on TSLA (+1.3% pre-market ahead of 1Q deliveries).

And all eyes are on Spotify's direct listing; our story says the stock will likely trade at a market value of ~$25 billion while Reuters reports that the NYSE set the company's reference price at $132.

How D.C. Watches the Markets

This tweet last night from CNBC's Washington Correspondent @EamonJavers got some attention: "White House official to me, on today's stock market sell off: 'We're focused on long term fundamentals. We're not really reacting to market fluctuations.'"

This was followed by senior White House economic official Peter Navarro saying that investors have overreacted recently, adding this: "I'm thinking the smart money is certainly going to buy on the dips here because the economy is as strong as an ox."

Reasons for Yesterday's Carnage

Some quasi-plausible reasons mentioned for yesterday's selloff: 1) Heightened concerns over a trade war with China and less headway on the negotiations front, 2) More excuses to take profits in some of tech's high-flying winners after Trump stepped up attacks on Amazon, Tesla fears compounded and Intel plunged over 6% on our scoop about Apple going in-house, 3) a weaker-than-expected ISM Manufacturing print, 4) lack of buyers to pick up the rubble given the Easter Monday-related absence of much of Europe (Marko Kolanovic seems to support this thesis), and 5) S&P 500 smashing through major technical levels.

But there were some oddities in the carnage that stood out, like how Treasuries hardly caught a bid in a session where equities ticked lower pretty much ever chance they got. And while many blamed a rout in tech stocks for the weakness, this selloff seemed a bit more broad than that, and thus different from the ones we've seen of late.

For example, out of the top 10 worst performers in the S&P 500 yesterday, only two were tech-related (INTC and AMZN, the latter technically in consumer discretionary) while the rest were airlines, auto retailers, energy stocks, Tyson Foods (pressured due to pork tariffs) or Nektar Therapeutics, which remains the best performer in the index year-to-date.

Tick-by Tick Guide to Today's Actionable Events

• Today -- Auto sales and Class 8 preliminary truck data expected
• Today -- TSLA expected to report 1Q deliveries by April 3
• Today -- SPOT direct listing and ADT non-deal roadshow with Goldman
• Today -- MRK Pdufa for Keytruda
• 7:30am -- ISCA earnings
• 9:30am -- Fed's Kashkari speaks
• 9:30am -- ANIK analyst day
• 1:00pm -- DOV's Apergy investor day ahead of May spinoff
• 1:30pm -- QDEL analyst day
• 4:05pm -- CLDR, PLAY earnings
• 4:30pm -- Fed's Brainard speaks on financial stability
• 4:30pm -- API oil inventories

To contact the reporter on this story: Arie Shapira in New York at ashapira3@bloomberg.net.

To contact the editors responsible for this story: Chris Nagi at chrisnagi@bloomberg.net, Joanna Ossinger

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