Wall Street Optimism After Long Decline
US stocks started the week with a solid gain, continuing to recover from a four-week decline. On Monday, the major indices showed positive dynamics amid investors' eagerness to take advantage of bargain buying opportunities. At the same time, market participants analyzed the latest macroeconomic indicators, assessing their impact on US economic policy.
Weak Retail Sales and Industrial Production
February retail sales data came in weaker than analysts expected, signaling growing economic uncertainty. The main pressure factors were the imposed trade tariffs and mass layoffs in federal structures.
An additional alarm signal came from the industrial sector. The New York manufacturing business activity index for March showed the largest drop in the last two years, indicating a slowdown in manufacturing activity in the region.
Stock indices continue to grow
Despite the mixed economic data, the US stock market demonstrated confident growth:
- The Dow Jones Industrial Average added 353.44 points (+0.85%) and reached 41,841.63;
- The S&P 500 rose by 36.18 points (+0.64%) to 5,675.12;
- The Nasdaq Composite rose 54.58 points (+0.31%) to 17,808.66.
Construction sector under pressure from tariffs
Negative sentiment continues in the construction industry. The US homebuilder confidence index fell to its lowest in seven months. The reason is the rise in the cost of building materials due to new trade tariffs, which makes projects less profitable.
The Fed prepares for a key meeting
Investors are closely watching the upcoming meeting of the US Federal Reserve, which will take place on Wednesday. According to forecasts, the regulator will leave the key rate unchanged. However, more attention is drawn to the Fed's macroeconomic forecast. Its publication is expected to give an idea of how US central bankers assess the outlook for the economy in the context of the ongoing trade policies of the Trump administration.
Financial markets continue to adapt to changes, and investors analyze signals that will help predict further developments.
Atlanta Fed Downgrades Outlook: Economy Under Pressure
The Atlanta Federal Reserve has revised its forecast for economic activity in the first quarter down to a 2.1% decline. On March 7, the estimate was more optimistic - minus 1.6%, but macroeconomic factors and market instability forced analysts to revise their expectations.
Markets in Search of a Bottom: Investors Cautiously Buy Assets
The last few weeks have been difficult for the US stock market. The S&P 500 index has lost more than 10% from its February all-time high, officially entering the correction zone. However, on Friday, the market showed signs of recovery, when investors began to choose stocks that could potentially benefit from the Trump administration's economic policies.
Dow Jones Cuts Losses, but Nasdaq Remains Under Pressure
The Dow Jones index managed to recoup some of its losses and is now about 3% from the correction mark, having shown growth over the past two trading sessions. Meanwhile, Nasdaq confirmed its correction on March 6, indicating continued volatility in the technology sector.
Who's in the black? Real estate and energy are leading the way
Among the 11 key S&P 500 sector indices, the strongest gainers were:
- Real estate (.SPLRCR) — investors are seeking safe havens, including real estate investments;
- Energy (.SPNY) — demand for energy remains robust.
At the same time, consumer discretionary (.SPLRCD) was the only one to show a decline, indicating a possible decline in consumer confidence and a reduction in household spending.
Treasury Secretary Warns of Recession Risk
Amid market instability and worsening forecasts, Treasury Secretary Scott Bessent made an alarming statement: "There is no guarantee that the United States will be able to avoid a recession." The comments added uncertainty to markets as investors now look even more closely at the Fed's actions and economic data.
Tesla Loses Ground: Investors Disappointed with Forecasts
Tesla (TSLA.O) shares have shown a significant drop of 4.79% after analysts at Mizuho lowered their target price for the company from $515 to $430. This was another blow for the automaker, whose shares have already lost 41% in annual terms.
Investors continue to analyze the situation, trying to predict further developments. The focus remains on the Federal Reserve, whose upcoming meeting may provide key guidelines for the stock market and the economy as a whole.
Quantum Technologies in Focus: Sector Stocks Are Growing Rapidly
The stock market is seeing significant growth in shares of companies specializing in quantum computing. On Monday, D-Wave Quantum (QBTS.N) shares soared by 10.15%, while Quantum Corp (QMCO.O) showed an impressive jump of 40.09%. This growth was caused by the start of the annual conference of Nvidia (NVDA.O), a leader in the production of chips for artificial intelligence, which increased investor interest in promising technologies.
Intel changes strategy: investors react with growth in quotes
An equally noteworthy event was the increase in the value of Intel (INTC.O) shares by 6.82%. Investors were optimistic about the news that the new CEO Lip-Bu Tan is preparing to carry out serious reforms in the company's production processes. In particular, we are talking about modernizing approaches to chip development and introducing new strategies in the field of artificial intelligence.
Hong Kong market breaks records, Asia shows growth
On Tuesday, Asian markets also showed positive dynamics. Hong Kong's Hang Seng Index (.HSI) rose 2% during morning trading, securing the title of the fastest-growing stock market of the year. Since the beginning of 2024, its total growth was 23%, which was the best result among all world indices. Investor optimism is driven by positive economic data and the Chinese government's intention to support consumption, which is bolstering confidence in the market.
FX Market Reacts to China Outlook
FX markets also reflected positive developments in the Asian economy. Traders who had previously bet on the weakening New Zealand dollar began to actively close positions, which led to the currency rising to a three-month high of $0.5827.
The Australian currency showed similar dynamics, which reached a one-month high, approaching $0.64. Meanwhile, the Chinese yuan remains near its highest values in a year, confirming that markets are positive about the state of the Chinese economy.
Investors Watch Trends
Growing interest in quantum computing, artificial intelligence and the Chinese economy are shaping new vectors for global markets. In the coming weeks, analysts will be closely monitoring how these trends develop further, assessing how sustainable the current growth is and which sectors will continue to attract investor attention.
OECD warns US tariffs could hurt North America
The Organisation for Economic Co-operation and Development (OECD) issued a grim forecast on Monday, saying tariff hikes initiated by the Donald Trump administration could slow economic growth in the US, Canada and Mexico. It also predicted rising inflationary pressures, which could complicate the market situation and affect Federal Reserve policy.
China benefits from US uncertainty
Despite Washington's trade restrictions, China has emerged as an unexpected beneficiary. Investors worried about a possible slowdown in the US economy have begun to actively transfer capital abroad, strengthening Beijing's position in global markets.
Adding further stimulus to the Chinese market were new measures to support domestic demand. On Sunday, the Chinese government announced subsidies for child care, as well as a comprehensive program to stimulate consumption. On Monday, fresh economic data confirmed that the country's retail sales growth accelerated in January and February, bolstering investor confidence.
Additionally, Donald Trump said that Chinese President Xi Jinping might visit the United States in the near future, raising expectations of breakthrough talks that could ease tariffs and ease trade tensions.
Hong Kong and Asian financial markets show resilience
Hong Kong financial markets also responded to the influx of capital. The Hong Kong dollar strengthened, holding at the top of its acceptable range against the US currency. Meanwhile, Hong Kong interbank rates fell, indicating increased liquidity in the financial hub.
Mainland China shares (.SSEC) showed modest gains, while MSCI's broad index of Asia-Pacific shares rose 1%. Other key regional bourses also closed higher:
Japan's Nikkei Posts Best Performance in Three Weeks
Japan's stock market is not far behind. The Nikkei (.N225) index soared 1.5%, posting its strongest gain in three weeks, driven by positive investor sentiment and expectations of a further recovery in the Asian economy.
Investors Look for New Growth Points
Amid global economic uncertainty, China and Asian markets continue to attract capital, demonstrating relative resilience to turbulence. Meanwhile, White House policy remains a key factor that could influence further developments. Investors are eagerly awaiting a possible meeting between Xi Jinping and Trump, hoping for positive developments in trade relations.
US Stock Market Stabilizes, but Uncertainty Remains
After a volatile trading session, the US stock market managed to hold off on further declines, but investors remain wary. April is approaching, and with it the implementation of new tariff measures announced by the Donald Trump administration. Financial markets are bracing for potential trade tensions, adding to volatility.
Weak macroeconomic data weighs on dollar and bonds
Fresh US economic data disappointed analysts. Retail sales and industrial production showed weaker results than expected. This led to a decline in the US dollar and weakening US bond yields.
Against this backdrop, gold has once again become the focus of investors as a traditional safe-haven asset.
Gold sets a new record, and the currency market reacts with growth in the euro and pound
During the Asian session, gold quotes reached a historical maximum of $3,005 per ounce. This growth is due to ongoing economic uncertainty, as well as a weakening dollar, which makes the precious metal more attractive to international investors.
On the currency market, the euro continues to hold positions above $1.09, reflecting the stability of the European economy amid American turbulence. The British pound, which hit a four-month high overnight, approached the key $1.30 mark but has yet to break through.
Debt market remains stable
Despite market fluctuations, the yield on 10-year US Treasury bonds remained unchanged at 4.293%. This suggests that investors are not rushing to make any sudden moves as they wait for further developments.
