Stocks Under Pressure Amid Trade Tensions and Economic Data

This week, stocks faced challenges as trade tensions, disappointing economic indicators, and profit-taking in technology dampened Wall Street’s momentum. Early in the week, consumer confidence plunged, prompting a shift toward bonds that pushed the 10-year Treasury yield to its lowest since December. Trade war concerns intensified when President Trump reiterated tariffs on Mexico and Canada and hinted at potential levies on European Union products.

Nvidia’s (NVDA) earnings report garnered significant attention, surpassing expectations but failing to lift the tech sector, as investors opted to take profits after a recent upswing. The Nasdaq Composite (IXIC) experienced its worst single-session loss since December. Economic indicators, including jobless claims and gross domestic product (GDP) figures, presented a mixed picture of the U.S. economy. Traders also evaluated inflation data that aligned with economists’ forecasts as February concluded, yet all three major indexes appeared on track for monthly losses.

Earnings Surprises and Setbacks

Initially, NVDA’s strong earnings triggered a rally, but it eventually lost ground as investors took profits. PayPal (PYPL) stock surged after management provided an upbeat outlook, indicating confidence in future growth. Home improvement giants Lowe’s (LOW) and Home Depot (HD) surpassed earnings predictions, while Salesforce (CRM) shares fell  following a disappointing outlook that affected investor sentiment. Additionally, Domino’s Pizza (DPZ) stock suffered due to an earnings miss amidst signs of soft consumer demand.

Looking Ahead: Key Stocks and Market Dynamics

As March unfolds, Arista Networks (ANET) emerges as one of the 25 best stocks to watch, with analysts anticipating a breakout following its recent pullback. Conversely, Boeing (BA) continues to face pressure, historically identified as one of the 25 worst stocks for the upcoming month. Netflix (NFLX) stock may be ready for a rebound, with shares nearing a critical bullish trendline.

Short sellers are targeting AppLovin (APP), which had previously topped performance rankings in 2024, raising concerns about the sustainability of its momentum. Meanwhile, investor optimism for electric vehicle (EV) stocks is waning as the sector confronts various obstacles.

March Opens With Economic Insights

March kicks off next week with key economic data, including jobs reports, final inflation readings, and the Fed’s Beige Book. On the earnings front, attention will turn to retail and chip stocks, with major reports expected from Costco (COST), Macy’s (M), and Broadcom (AVGO). Investors should monitor S&P 500 Index (SPX) support levels as the market progresses, alongside insights on how extended win streaks may influence stock performance.

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