With investors honing in on President Donald Trump’s April 2 tariff announcement as a pivotal date, they also might want to give some thought to what happens two days later. In fact, April 4, when the Bureau of Labor Statistics announces the March nonfarm payrolls number, could be a more pivotal day in the view of Michael Hartnett, Bank of America’s chief investment strategist. Harntett contends that the Trump “Liberation Day” announcement — when countries will face additional tariffs — might get soft-pedaled as the president wants to avoid another wave of inflation. Separate reports Friday indicated higher-than-expected core inflation for February and another leg lower in consumer sentiment as inflation worries are surging. “We say April 4th more [important] than April 2nd; positioning says risk is weak payroll & new [S & P 500] lows,” Hartnett said in his weekly note analyzing investor money flows. “U.S. bank stocks the ‘tell.'” Hartnett cautioned that the KBW Bank Index needs to hold 120, a level where it traded around on Friday. .BKX YTD line KBW Bank Index in 2025 Economists already are expecting muted job gains for March, with the Dow Jones consensus estimating an increase of just 140,000 and the unemployment rate holding at 4.1%. In Hartnett’s view, a payroll number between 100,000 to 200,000 will equal a “soft landing” with “no recession” and the recent S & P 500 low around 5,500 holding. However, a number below 100,000 means a “hard landing” with the index falling “to new lows in April, taking global stocks, banks, credit down (kick-starts big Trump pivot to tax cuts).” .SPX YTD mountain S & P 500 year to date Stocks slumped on Friday following the inflation report and ongoing fears over tariffs and inflation and their impact on economic growth. Hartnett noted that gold saw $3.2 billion in fresh investor cash last week, spurred by a $2.2 billion burst on March 21 that was the single-biggest day on record. At the same time, equities saw $9 billion in outflows. Even with the drain on stocks last week, BofA private client purchases over the past three weeks were the biggest since September 2022.
