Key level and sentiment watch/BoJ/More on what companies are seeing out there

5671 is the S&P 500 level to closely watch as it was the April 2^nd 4pm close minutes before the 10% blanket tariffs were announced along with the unveiling of the reciprocal white board and the further escalation of tariff rates with China.

In terms of market sentiment, there are still more bears than bulls in some of the gauges I look at. Investors Intelligence saw Bulls rise to 28.8 from 23.5 but is still below the number of Bears which fell to 32.7 from 35.3. In the AAII survey, Bulls stand at 20.9 vs 21.9 in the week before. The recent high in late January was 41 and it touched 19.1 in mid March for this very fickle figure. Bears rose by 3.7 pts to 59.3 and is almost double the 34 it was at in late January. The high was one month ago at 61.9. One month ago the CNN Fear/Greed index got to as low as 4 and yesterday closed at 36, still in Fear category but no longer in Extreme Fear.

Bottom line, sentiment is still worried and scared but a bit less so, and from a contrarian standpoint it's a positive in the short term. I emphasize 'short term.'

The Bank of Japan sat tight as expected and with all the unknowns there was no commitment on another rate hike and why JGB yields and the yen are weaker while the Nikkei rallied by 1.1%. Sort of a bottom line from Governor Ueda, "Looking ahead, we see the chance of underlying inflation slowing. As such, we decided that we can maintain the degree of monetary support at least at this policy meeting"

Also, "Although we downgraded our forecasts, we still expect underlying inflation to converge toward 2% during the three year projection period of our quarterly report...We won't try to forcefully raise interest rates when underlying inflation is stalling. But if we see prospects of inflation accelerating toward 2%, then we could act."

Let's get to the comments from Microsoft and Meta, among others, which of course is driving the pre market rally and where we know Q1 was really old news and any guidance on both top line and CapEx was more of the focus.

From Microsoft: