Markets Swing Lower as Economic Data and Major Stocks Weigh Heavy

The S&P 500 Index ($SPX) (SPY) has dipped by -0.37%, while the Dow Jones Industrial Index ($DOWI) (DIA) is slightly up by +0.02%. The Nasdaq 100 Index ($IUXX) (QQQ) sees a more substantial decline at -0.85%. Additionally, March E-mini S&P futures (ESH25) are down -0.24%, and March E-mini Nasdaq futures (NQH25) are off by -0.70%.

Steep Losses Add Up, Consumer Sentiment Hits Low

This downturn follows a sharp drop last Friday, when the S&P 500 index lost -1.71%, and the Nasdaq 100 index fell by -2.06%. Negative economic indicators contributed to this trend, notably the University of Michigan’s US February consumer sentiment index plummeting to a 15-month low of 64.7. Inflation expectations for the next 5-10 years reportedly rose to +3.5%, the highest in 29 years.

Major Tech Stocks Struggling

Today’s stock performance is further dampened by losses in crucial Magnificent Seven stocks, particularly Meta, Tesla, and Microsoft. Nevertheless, a slight boost is seen in the market with the 10-year T-note yield declining by -3 basis points.

New Measures Against China Shake Markets

The Trump administration has introduced new measures targeting China. Proposed fees on commercial ships built in China have driven down Chinese shipping stocks. Moreover, President Trump directed the US Committee on Foreign Investment to limit Chinese investments in key sectors like technology and agriculture.

Anticipation Builds for Nvidia’s Earnings

Meanwhile, investors are closely watching Nvidia’s earnings report set for after Wednesday’s market close. This week’s economic calendar is packed. The Conference Board’s consumer confidence index is expected to show a decrease of -1.4 points to 102.7. Anticipated further, Thursday’s Q4 GDP report is projected to indicate a +2.3% quarterly rise, with a +4.1% boost in personal consumption. Following that, Friday’s January PCE price index report might reveal a slight ease in inflation from +2.6% to +2.5% year-over-year.

Global Markets Mixed, Interest Rates Impact T-Notes

Currently, the markets estimate just a 2% chance of a -25 basis point rate cut at the upcoming FOMC meeting on March 18-19. In Europe, the German Dax index is up by +0.31%, following the conservative Christian Democrat party’s plurality win in Sunday’s German elections. However, forming a ruling coalition may prove challenging.

In international markets, the Euro Stoxx 50 is down by -0.54%. China’s Shanghai Composite Index has closed down by -0.18%, while Japan’s Nikkei 225 ended up +0.26%.

Interest Rates on the Move

The March 10-year T-notes (ZNH25) have increased by +5 ticks, though the yield is down -3.3 basis points to 4.398%. Prices have been supported by safe-haven demand amid stock declines, but are facing pressure from upcoming Treasury sales totaling $69 billion for 2-year T-notes today, $70 billion for 5-year T-notes tomorrow, and other significant offerings for longer durations.

In Europe, rising bond yields are influencing T-note prices. The 10-year German bund yield increased by +2.2 basis points to 2.492%, while the 10-year UK gilt yield rose by +2.3 basis points to 4.594%. Market swaps indicate a 98% likelihood of a -25 basis point rate cut by the ECB at its March 6 meeting.

US Stock Movers: Mixed Results in the Market

Among the Magnificent Seven stocks, only Alphabet and Apple are showing gains. Apple (AAPL) experienced a +0.5% rise as it announced plans to hire 20,000 Americans and invest at least $500 billion in US innovation over the next four years, including building a manufacturing plant in Houston for AI servers.

Conversely, Nvidia (NVDA) is down -0.8% as investors await its earnings report. Microsoft (MSFT) has dropped over -1% due to a TD Cowan report indicating canceled leases for US data center capacity, which raises doubts about AI demand. Tesla (TSLA) also fell more than -1%, despite news of an upcoming software update for Chinese drivers.

Palantir Technologies (PLTR) has plummeted by -8%, compounding last week’s -15% drop amid concerns about expected cuts in US defense spending.

On a positive note, Berkshire Hathaway (BRK.B) has surged by over +3% thanks to a strong Q4 earnings report. Nike (NKE) is also up by more than +5% following a Jefferies upgrade to buy due to a positive outlook. In contrast, Domino’s Pizza Inc. (DPZ) is down by over -2% due to disappointing Q4 sales, as US consumers tighten their spending. Robinhood Markets (HOOD) has decreased by -4%, despite the SEC concluding its crypto investigation without any penalties.

Upcoming Earnings Reports

Key companies reporting earnings on 2/24/2025 include Coterra Energy Inc (CTRA), Diamondback Energy Inc (FANG), Domino’s Pizza Inc (DPZ), ONEOK Inc (OKE), Public Storage (PSA), Realty Income Corp (O), and SBA Communications Corp (SBAC).

On the date of publication, Rich Asplund did not hold any positions in the securities mentioned in this article. All information and data are for informational purposes only. For further details, please view the Barchart Disclosure Policy here.

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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.