In Markets "In a Nutshell"

Markets “In a Nutshell” for March 3, 2025

Investment Week at a Glance

Stocks finished lower for the week. The Dow Jones Industrial Average rose 1.0%, the S&P 500 was down 1.0%, and the NASDAQ fell 3.5%. Foreign stocks (MSCI EAFE) were also down, falling 0.1%. Bond prices were up for the week, with the 10-year U.S. Treasury ending the week at 4.21%.  (Data source: Wall Street Journal)

Market Volatility

Markets had a rough week but rallied in the last few hours of trading on Friday to recoup some losses. One reason for the recent pullback is policy uncertainty as tariffs are set to go into effect this week. President Trump also announced an additional 10% tax on Chinese imports as well as new tariffs on the European Union set for the first week in April. Another reason for the recent pullback is that big tech has struggled this year unlike 2023 & 2024. The NASDAQ is down over 2% for the year as tech overall has been the laggard for 2025. Investors will watch closely to see if this trend continues or if we see tech begin to catch up to the rest of the market this year.

Strong Economic Conditions

The economy continues to perform well and looks to be in a strong position for 2025. GDP estimates are for 2.3% growth in 2025, above the long-term estimate of around 2%. The unemployment rate continues to be 4% which is a historically low rate. Wage growth is also strong as it has exceeded inflation for 21 straight months. Corporate profits continue to grow as year-over-year the S&P 500 companies saw an 18% increase since last year. 2025 estimates also show another double-digit increase in profit for companies. Inflation remains at 3% but overall has continued in a downward trend and analysts don’t expect a sharp move higher.

Nvidia Earnings Beat Estimates, Stock Falls

Nvidia beat earnings last week as revenue came in at $39.33 billion vs. $38.05 billion estimated and earnings per share (EPS) came in at 89 cents vs. 84 cents estimated. Despite the strong report, the stock fell by roughly 8% as investors had a high bar for Nvidia and this was the smallest magnitude of a beat in 8 quarters. The company also warned profitability will be lower than expected as they rush to roll out its new chip design. Nvidia has been one of the biggest winners the past couple of years so a pullback is not unexpected, but investors will hope to see a quick rebound. (CNBC)

Quiz:

What index has performed the best in 2025? (Scroll Down for Answer)

  1.    Dow Jones
  2.    S&P 500
  3.    NASDAQ
  4.    MSCI EAFE

 

 

 

 

 

 

Answer below.

 

 

Have a Great Week!

 

 

 

 

 

 

 

Answer:

4.  MSCI EAFE. International equities have had a strong year up over 8% to start 2025. International equities trailed the U.S. markets for quite some time but have been able to outperform to start 2025.

 

 

 

 

 

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