In Markets "In a Nutshell"

Markets “In a Nutshell” for March 10, 2025

Investment Week at a Glance

Stocks finished lower for the week. The Dow Jones Industrial Average fell 2.4%, the S&P 500 was down 3.1%, and the NASDAQ fell 3.5%. Foreign stocks (MSCI EAFE) were up, rising 3.5%. Bond prices were down for the week, with the 10-year U.S. Treasury ending the week at 4.30%.  (Data source: Wall Street Journal)

Economic Growth Estimates Shift Lower

2024 GDP finished the year strong as the 4th quarter GDP came in at 2.5% and consumption healthy at 4.2%. Q1 2025 GDP does not look to be as strong as the Atlanta Fed GDP tracker is pointing to a -2.4% annualized growth rate for the first quarter as there is an expected spike in imports which detracts from GDP. The expected rise in imports is due to companies trying to import more goods before tariffs take effect. This will likely reverse in Q2, but consumption is also forecast to slow to 0.4% and consumption makes up 70% of GDP so this could be a longer-term drag.

Rate Cuts Back in Play?

With economic growth projected to slow as well as estimated corporate earnings being lower than expected, the market is now pricing in 3 rate cuts for the rest of the year. This is an increase from the expected one cut that was priced in just a couple of weeks ago. If the economy and markets start to slow down and move lower the Fed would likely intervene in hopes of avoiding a recession. These projections could shift rapidly if tariffs go away or if the economy continues to grow as it was. The most recent jobs report added 151,000 jobs and unemployment slightly ticked up to 4.1%. These numbers do not include the recent government layoffs so investors will pay close attention to the next few reports to see the type of impact those have on unemployment and the job market.

Broadcom Earnings Beat Estimates, Stock Rises

Broadcom stock jumped on Friday by more than 8% after delivering a beat on earnings and an increase in guidance. This was welcome news for investors as there had been some worry about AI demand weakening but Broadcom was able to put those worries to rest. Broadcom also announced 2 new AI chip customers bringing its total to 7. Despite the recent gain, Broadcom remains down over 15% for the year as tech as a whole has been hit the hardest. Over the past 5 years, Broadcom has benefited from the AI boom as its stock is up over 700%. (CNBC)

Quiz:

What is the return on the NASDAQ for 2025? (Scroll Down for Answer)

  1.    -17%
  2.    -13%
  3.    -9%
  4.    -6%

 

 

 

 

 

 

Answer below.

 

 

Have a Great Week!

 

 

 

 

 

 

 

Answer:

4.  -6%. The NASDAQ has been the worst index for 2025 as tech has been hit the hardest to start the year. Despite the recent sell off, markets have not been hit too hard when looking at 2025.

 

 

 

 

 

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