Tariff Twist Brings Hope and More Volatility

As we head into the second half of April, the market continues to digest the evolving tariff landscape with both cautious optimism and justified skepticism. Investors are still wading through daily headlines and policy surprises, but late-breaking news last Friday may represent a pivotal shift, especially for one of the hardest-hit sectors: technology.

Markets Still Volatile, But a Glimmer for Tech

First, let's level-set: volatility isn't going away anytime soon. We’re likely going to live in this choppy environment through at least the early summer. Until we get full clarity on how the Trump administration’s reciprocal tariff plan ultimately plays out, and especially what’s finalized around the July 4th timeline (when tariff policy is expected to be finalized), markets will continue to react swiftly to every policy twist.

That said, this past week gave tech investors something they haven’t seen in a while: renewed hope.

On Friday, the Trump administration quietly issued exemptive guidance excluding smartphones, computers, and other select electronics from the new 125% tariff list on Chinese imports. If this holds, it could prove to be a significant break for global technology manufacturers — including hardware names like Apple and Dell, semiconductor players like Broadcom and NVIDIA, and high-growth innovators across AI and quantum.

Markets responded with cautious optimism. While early trading remained choppy, the NASDAQ-100 showed signs of stabilization by mid-afternoon, reflecting investor interest returning to key tech names:

To be clear, we don’t have the final word from Washington yet, and we’ve seen exemptions walk back before. But assuming this guidance is upheld, it substantially narrows the scope of the most aggressive tariff threat in play. That’s meaningful for tech earnings, innovation pipelines, and even consumer pricing in the near term.

Why This Matters for AI, Quantum, and the MAG7

These exclusions, if durable, could offer significant cost relief for some of the market’s most pressured names this year. Quantum computing and AI-focused companies, many of which rely on specialized chips and high-performance electronics, have been under immense pressure this year, not just from valuations but from geopolitical risk.

Now, with key components potentially spared from punitive tariffs, we could see:

• A repricing of earnings expectations and forward valuations in the AI/quantum space
• A relief rally across the MAG7, where names like NVIDIA and Apple sit at the intersection of consumer tech and advanced innovation
• An inflection point for sentiment, particularly among institutions that have been sitting on the sidelines waiting for a clearer policy tone

While it's too early to call this a full reversal of recent tech weakness, this shift could bring a much-needed tailwind to a sector that’s been under duress.

Let’s Temper the Enthusiasm (For Now)

There are still important caveats to keep in mind:

• Policy whiplash is real — this could change again, especially as political negotiations continue and new “special tariffs” (as noted in Lutnick’s latest post) get floated
• We don’t yet have full clarity on the specific definitions around “electronics” and “components” — this matters a lot for semiconductors and finished goods
• Markets are forward-looking but skittish — one positive headline can rally a sector, but it takes consistency in messaging and execution to build conviction

So, let’s position this for what it is: potentially very good news, but not something we can bank on with high conviction until the details are confirmed.

In short, we have a promising signal, but not yet the full story.

What Should Investors Do Now?

With volatility still elevated and macro noise front and center, here’s what investors should be thinking about:

1. Use the Dips Strategically

This is a market made for disciplined buying. If you’re a long-term investor with a multi-year horizon, these types of pullbacks have historically created the best opportunities.

2. Consider Leveraged ETFs for Short-Term Traders

For more sophisticated, short-term investors, leveraged ETFs can offer a smart way to capitalize on the daily swings we’re seeing, particularly in thematic spaces like AI, quantum, and innovation, more broadly. We saw record creations in these categories last week as traders reentered the market on signs of recovery. It’s worth noting that leveraged ETFs are best suited for active investors who can closely monitor positions, as amplified exposure works both ways.

3. Zoom Out and Think Generationally

If you believe in the long-term future of AI, quantum computing, and next-gen tech infrastructure, and you're looking past this quarter, these price levels may end up being generational entry points. Many of these names are trading at levels we haven’t seen since before the 2023 breakout.

4. Diversify Your Tech Exposure

If you’re over-concentrated in the MAG7 or want a different risk-reward profile, consider ETFs providing broader exposure to large-cap growth without the over-weight to the tech supermajors.

Bottom Line

Markets are still navigating uncertainty, but last week’s tariff shift offers a potential path forward, especially for tech investors. While we’re not out of the woods yet, and the full policy picture is still forming, investors should take note of the opportunity this creates: relief for tech, resilience in innovation, and the potential for a re-rating of growth names into the summer.

Importantly, this isn’t the first time markets have had to absorb major shocks, and it won’t be the last. From the “Lost Decade” to the COVID-19 pandemic to geopolitical tensions and inflation surges, markets have consistently found ways to recover and reward patient investors.

This chart is a powerful reminder: staying invested through volatility has historically paid off, and then some. While short-term pullbacks are uncomfortable, they often create some of the best long-term entry points.

So stay focused on fundamentals. Keep diversified. And don’t let short-term headlines shake your long-term conviction.