Tesla warns of retaliatory tariffs. BofA thinks Trump will flip on trade policy

Two articles today that gave me a lot more confidence about the market.

"Tesla warns Trump administration it is ‘exposed’ to retaliatory tariffs" from Financial times (archive link). A snippet from the letter:

“Nonetheless, even with aggressive localisation of the supply chain, certain parts and components are difficult or impossible to source within the US,” the company added. It urged Greer to “further evaluate domestic supply chain limitations to ensure that US manufacturers are not unduly burdened by trade actions that could result in the imposition of cost-prohibitive tariffs on necessary components”.

In another article -- "Trump will flip on trade policy before this turns into a bear market, surmises BofA’s Hartnett" from CNBC (archive):

Though administration officials have repeatedly said that they view the current stock market correction as a temporary reaction to the president’s pro-Main Street agenda, eventually Trump will react, the bank’s chief investment strategist said in his weekly analysis of market trends.

“We say this is a correction, not a bear market in U.S. stocks,” Hartnett wrote. ”[M]arkets stop panicking when policy makers start panicking’ … since equity bear threatens recession, fresh declines in stock prices will provoke flip in trade & monetary policy back to ‘he loves me’ stance.”

But will the selling continue? Is today the bottom?

Hartnett thinks the market damage will be limited, but he doesn’t expect the selling is over yet.

The large-cap S&P 500 index would be “a good buy” should it hit 5,300, which would be another 4% lower from Thursday’s close, and when institutional investors’ cash levels surge above 4%.

One “ominous” sign that he sees during the current sell-off is the simultaneous decline in both stocks and Treasury yields, a trend he said is similar to market behavior in 2000, 2002 and the 2008 financial crisis period.

“Good news is financial conditions [are] easing” Hartnett noted, citing lower yields as well as declines in the U.S. dollar and oil.” Hartnett added that “corrections end once sell-off ‘laggards’ crack,” citing rising credit spreads.

“Bottom line…up-in-stocks, up-in-yields, up-in-dollar positioning painfully up-in-smoke thus far in ’25, but sentiment/positioning/price signal equity correction not quite over,” he said.

What are your takes on whether we've seen the worst of the tariff turmoil? Do you think with companies like Tesla giving feedback President Trump might slow down the aggressiveness and unpredictability of the tariffs? If tariff policy is flipped to something much more mundane and predictable what stocks are you buying?