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Navigating the War Inflation Cycle · The SPY Trader

• 0:00
  Good morning, traders!
• 0:01
  Happy Good Friday to you and your families.
• 0:04
  It's 6 am on Friday, April 3rd, 2026, and you are listening to the Spy Trader podcast.
• 0:10
  I am your host, Barnaby Bull, and while the stock exchanges are closed today for the holiday, the financial world is anything but quiet.
• 0:18
  Even though the floors are silent, we just received a massive March Nonfarm Payrolls report that has everyone talking.
• 0:25
  Today, we are going to dive into what these numbers mean for your portfolio, how the ongoing 'War Inflation' cycle is shifting the landscape, and where you might want to look when the opening bell rings again.
• 0:39
  First, let’s look at where we left off.
• 0:42
  Yesterday, the S&P 500, or SPY, closed at 6,575.32.
• 0:45
  We have been dealing with a roughly seven percent correction since the conflict in Iran began earlier this year, though we did manage a tiny weekly gain of point one percent.
• 0:56
  The Nasdaq, represented by QQQ, ended at 21,840.95.
• 0:59
  Technology is feeling the heat from rising yields, but we are seeing some brave folks buying the dip after a tough first quarter.
• 1:08
  Meanwhile, the Dow Jones Industrial Average finished at 46,565.74, showing its strength thanks to heavy hitters in energy and industrial stocks.
• 1:15
  The big news this morning is the jobs report.
• 1:19
  Despite everyone expecting a slowdown, the U.S.
• 1:21
  added a whopping 178,000 jobs in March.
• 1:24
  That is way higher than the sixty to seventy thousand economists predicted!
• 1:28
  Our unemployment rate dropped to 4.3 percent.
• 1:31
  Usually, more jobs is great news, but right now, it gives the Federal Reserve more room to keep interest rates high to fight inflation.
• 1:40
  With the conflict in Iran and the closure of the Strait of Hormuz, WTI Crude Oil has climbed above 112 dollars a barrel.
• 1:48
  This is fueling what we call the 'War Inflation' cycle.
• 1:52
  Looking at individual companies, Nvidia is still the talk of the town.
• 1:56
  Following their GTC 2026 event, they are forecasting an incredible one trillion dollars in revenue through 2027.
• 2:02
  They really are the gold standard for AI right now.
• 2:06
  Intel also made waves, jumping nine percent this week after a 14.2 billion dollar deal to reacquire a stake in its Irish manufacturing facility.
• 2:15
  On the flip side, Tesla had a rough patch, sinking over five percent after missing their delivery targets, and Amazon is making headlines with rumors that they might acquire Globalstar to boost their satellite connectivity.
• 2:27
  So, what should we do with this information?
• 2:30
  First, consider a 'War Hedge.' As long as there is tension in the Middle East, oil prices will likely stay high.
• 2:38
  I like the Energy Select Sector SPDR, or XLE, and even Gold through GLD.
• 2:43
  Specifically, Exxon Mobil, ticker XOM, looks strong because of its great balance sheet and dividend.
• 2:49
  Second, look at a 'Value Rotation.' Because highgrowth tech is feeling the pressure of high interest rates, many investors are moving into more stable areas.
• 2:58
  You might look at the Vanguard Total Stock Market ETF, VTI, or the iShares Russell 1000 Value, IWD.
• 3:04
  These include industrial and material stocks that benefit from manufacturing moving back to American soil.
• 3:10
  Third, be very careful with fixed income.
• 3:12
  I would suggest avoiding longduration bonds like TLT for now.
• 3:16
  With the jobs report being so strong, interest rates are likely to stay high, which hurts the value of longterm bonds.
• 3:24
  If you need a safe place for cash, shortterm treasury ETFs like SHY are a much safer bet to avoid interest rate risk.
• 3:32
  Finally, stay selective with your tech holdings.
• 3:35
  Even though the sector is volatile, the AI infrastructure buildout is a longterm story.
• 3:40
  You don't have to run away from tech entirely, but stick to the giants with plenty of cash flow, like Microsoft, ticker MSFT, or the broader tech sector fund, XLK.
• 3:51
  They have the muscles to weather this highrate environment.
• 3:54
  To wrap things up, we are in a bit of a 'waitandsee' mode regarding global events.
• 4:00
  Defensive value and energy are the safest ports in this storm for now.
• 4:05
  Treat your highgrowth tech as a longterm hold rather than a quick trade until we hear more from the Fed later this month.
• 4:13
  That is all for this morning's update!
• 4:16
  Enjoy your holiday Friday, get some rest, and I will see you back here in a few hours.
• 4:22
  This is Barnaby Bull for Spy Trader, signing off.