The stock market’s surge off the April lows did little to impress traders in the options market, according to Amy Wu Silverman of Royal Bank of Canada. . After a sharp sell-off sparked by steep U.S. tariffs on imports, the S & P 500 ripped higher to recover all its losses from the April 2 announcement. From the bottom at the April 8 close through April 30, the S & P 500 surged 11.8%. Still, positioning in the derivatives market shows skepticism this rally will last, Silverman said. “The market may have roundtripped, but the derivatives market remains pretty angsty,” Silverman, the bank’s head of equity derivatives strategy, told CNBC’s ” Squawk Box ” in an interview. “If you actually just look from April 2 to now, even with the S & P roughly returning most of those losses … that demand for hedging, that concern has still wafted higher.” “That just speaks to the sentiment that we have about the uncertainty for the next few months, maybe even years,” she added. Part of that skittishness may stem from investors who have yet to hear news of concrete trade agreements resulting from talks among the U.S. and leading trading partners. But Treasury Secretary Scott Bessent told CNBC on Monday the U.S. is “very close to some deals.” Billionaire investor Paul Tudor Jones also raised concern about the state of the market, telling “Squawk Box” that stocks will ” probably go down to new lows , even when Trump dials back China [tariffs] to 50%.” President Trump has implemented levies amounting to 145% on China, which has retaliated with levies of its own. Bottom line, stocks may not be out of the woods just yet. Elsewhere Tuesday on Wall Street, BMO initiated Shopify with an outperform rating, noting the stock can withstand tariff pressures better than rivals. “While tariffs create near-term risk, we believe SHOP’s core strength is the agility that its platform provides to merchants,” analyst Thanos Moschopoulos wrote in a note. “In our view, tariff-related disruption will make this competitive differentiator all the more relevant, driving accelerated share gains.”
Options trading shows investors don’t really believe in this stock market comeback
May 6, 2025
