US Stock Markets Climb Amid Easing Government Shutdown Fears

The S&P 500 Index ($SPX) (SPY) is up +1.27%, the Dow Jones Industrials Index ($DOWI) (DIA) has risen +0.87%, and the Nasdaq 100 Index ($IUXX) (QQQ) is up +1.54%. Additionally, March E-mini S&P futures (ESH25) are up +1.33%, while March E-mini Nasdaq futures (NQH25) increase by +1.59%.

Market Conditions and Government Updates

Today’s market gains can be attributed to diminishing concerns over a potential US government shutdown. Senate Democratic leader Chuck Schumer announced Thursday night that he would not block the Republican continuing resolution (CR) designed to fund the government for six months. The House passed the bill on Tuesday, and the Senate is scheduled to vote on it this afternoon.

Global Market Support

Global equity markets received a boost from a rally in Chinese stocks, which reached a three-month high amid signals of additional policy support. Officials from China’s finance and commerce ministries, as well as the People’s Bank of China (PBOC), will hold a press conference on Monday to unveil measures aimed at enhancing consumption.

Consumer Sentiment and Inflation Concerns

Despite the positive market sentiment, stocks retreated from their highs following a report from the University of Michigan indicating a sharp decline in US consumer sentiment in March. The index fell -6.8 to a level of 57.9, marking its lowest point in over two years and falling below expectations of 63.0.

Moreover, inflation expectations have climbed unexpectedly. The one-year inflation expectations indicator rose to +4.9%, a two-and-a-third year high, surpassing the anticipated 4.3%. Similarly, the five-to-ten-year inflation expectations index reached a 32-year high at 3.9%, against a forecast decline to 3.4%.

Cryptocurrency Developments

In cryptocurrency news, Bitcoin (^BTCUSD) has seen a gain of more than +3% today. This increase follows rapid progress on a stablecoin bill, which is moving toward consideration by the full Senate after the banking committee voted 18-6 in favor late Thursday. Supported by President Trump, the proposed legislation aims to regulate privately issued, dollar-based stablecoins, potentially facilitating cheaper and faster transactions via smartphones.

Tariff Impacts and Market Pressures

Stocks have faced pressure over recent weeks due to concerns that US tariffs may hinder economic growth and corporate earnings. Last Tuesday, President Trump imposed a 25% tariff on goods from Canada and Mexico and doubled the tariff on Chinese imports from 10% to 20%. He also reiterated the plan to implement reciprocal tariffs on foreign nations starting April 2.

Further escalating trade tensions, the European Union introduced tariffs on up to $28.3 billion of US goods, including agricultural products, as a retaliation against US steel and aluminum tariffs. Additionally, Canada announced a 25% counter-tariff on around $20.8 billion worth of US-made goods.

Interest Rates and Bond Market Reactions

Markets currently indicate only a 1% chance of a -25 bp rate cut at the upcoming FOMC meeting scheduled for March 18-19. Meanwhile, overseas stock markets are also trending upward. The Euro Stoxx 50 is up +1.11%, China’s Shanghai Composite Index reached a three-month high with a +1.81% increase, and Japan’s Nikkei Stock 225 rose +0.72%.

US Bonds

June 10-year T-notes (ZNM25) are down -7 ticks, with the 10-year T-note yield up +3.4 bp to 4.303%. The decline in T-notes reflects lower safe-haven demand spurred by upward momentum in stock markets, particularly following Schumer’s announcement related to government funding. Furthermore, T-notes face pressure from a decline in German bunds linked to a report about an agreement on a debt package among German political parties. Today’s University of Michigan report also indicated rising inflation expectations.

European Bonds

European bond yields have increased, with the 10-year German bund yield rising by +4.9 bp to 2.905%, and the 10-year UK gilt yield up +1.7 bp to 4.694%. The German Fed CPI (EU harmonized) was revised lower to +0.5% month-over-month and +2.6% year-over-year from previous estimates of +0.6% and +2.8% respectively. ECB Governing Council member Holzmann noted that Eurozone interest rates have reached neutral levels and supports pausing ECB rate cuts in the upcoming month.

Notable Stock Movements

The “Magnificent Seven” stocks are making gains today, significantly contributing to market momentum. Nvidia (NVDA) leads the advancement in the Dow Jones, rising over +3%. Additionally, Meta Platforms (META) and Amazon.com (AMZN) are both up by more than +1%. Other tech giants like Microsoft (MSFT), Apple (AAPL), Tesla (TSLA), and Alphabet (GOOGL) have also registered significant increases.

Chip stocks are experiencing upward trends as well. Micron Technology (MU) rose more than +5% after receiving a buy upgrade from Aletheia Capital Limited, targeting a price of $145. ARM Holdings Plc (ARM) and Lam Research (LRCX) are also up by +4% and +3%, respectively. Other companies in the semiconductor space, including GlobalFoundries (GFS) and Advanced Micro Devices (AMD), are also seeing gains of over +2%.

DocuSign (DOCU) surged over +15% following its forecast of 2026 billings ranging between $3.30 billion and $3.35 billion, exceeding the consensus estimate of $3.22 billion. Meanwhile, Semtech (SMTC) rose over +13% after beating Q4 adjusted EPS estimates, reporting 40 cents compared to the consensus of 32 cents. Ulta Beauty (ULTA) gained over +9% after reporting a Q4 EPS of $8.46, well above the expected $7.12.

Crown Castle (CCI) increased by more than +8% following an agreement to sell parts of its fiber business to an EQT AB fund and Zayo Group Holdings for a total of $8.5 billion. Additionally, Rubrik (RBRK) soared by more than +25%, forecasting revenue for 2026 at $1.15 billion to $1.16 billion, surpassing the consensus estimate of $1.11 billion.

American Express (AXP) is up more than +1% after Baird upgraded the stock from underperform to neutral. In contrast, Abbott Laboratories (ABT) has fallen over -2%, leading losses in the S&P 500 due to a judge overturning a previous infant formula verdict linked to health claims. T-Mobile US (TMUS) is down over -1%, following a downgrade to neutral from buy by Citigroup due to valuation concerns.

Xponential Fitness (XPOF) plummeted over -35% after projecting full-year revenues between $315 million and $325 million, falling short of the consensus estimate of $342.9 million.

Upcoming Earnings Reports

Earnings Reports (3/14/2025) include AirSculpt Technologies Inc (AIRS), American Vanguard Corp (AVD), Arbutus Biopharma Corp (ABUS), Artiva Biotherapeutics Inc (ARTV), Bit Digital Inc (BTBT), Buckle Inc (BKE), Century Therapeutics Inc (IPSC), and several more.

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

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