Week Ending March 14th, 2024 


Market Moves 

Dow Jones - 41,433.48 (-1.14

Nasdaq - 17,436.10 (-0.18%) 

S&P 500 - 5,572.07 (-0.75%)

Weekly Recap

• More panic selling. American stocks extended their losses on Tuesday in what is shaping up to be a painful week in the stock market so far. A one-two punch of tariff uncertainty and recession fears has triggered a massive market sell-off in which the S&P 500 and Nasdaq Composite have both sunk to their worst performances since 2022 while the Dow Jones Industrial Average has also been tattered, falling 450 points on Tuesday alone. The S&P 500’s 2.7 drop on Monday was the index’s worst performance of 2025 so far. 
• A big inflation report is out today. February’s Consumer Price Index (CPI) report is due out today at 8:30 ET and will reveal the latest trajectory of inflation. Wells Fargo economists are predicting an increase of 0.25%, which would be less painful than January’s increase. In a speech last week, Federal Reserve Chair Jerome Powell warned inflation pressures would likely persist, even if Wednesday's report comes in as expected: "The path to sustainably returning inflation to our target has been bumpy, and we expect that to continue."
• Tariffs keep rattling Wall Street. All three major indexes dropped after President Donald Trump doubled down on his threat to levy a new round of hefty tariffs on Canada. “This market is just blatantly sick and tired of the back and forth on trade policy,” Art Hogan, chief market strategist at B. Riley Wealth Management, told CNN’s Matt Egan.
• European stocks slumped. European stocks went lower as the anxiety around Trump’s tariffs spread to global markets. The pan-European STOXX Europe 600 index dropped 1.7%. Germany’s DAX and France’s CAC indexes were each 1.3% lower on the day, while London’s FTSE 100 was down 1.2%.
• Recession likelihood increased. JPMorgan has revealed that the chances for a U.S. economic recession in 2025 have now increased from 30% to 40%. JPMorgan analysts also expect that a relief rally is on its way in the stock market, saying chances for a rebound are greater than any immediate declines despite a slowing economy. 
• Tesla shares rebounded. After sinking 15% on Monday in response to selling pressure and shaving $29 billion from Elon Musk’s net worth, Tesla stock rebounded on Tuesday, gaining nearly 4%. 
• AI stocks bucked the downward trend. Shares of Nvidia, CrowdStrike and Super Micro Computer all higher. Super Micro led the way with a 10.6% gain as a top performer in the S&P 500. 
• Apple stock dragged on the Nasdaq Composite. The iPhone maker's shares sank 2.3%. 
• Southwest shares soared. The airline reported on Tuesday that it would start charging passengers for bags, a reversal in policy that will generate an additional revenue stream.
• Microsoft declared a quarterly dividend. The tech company announced a $0.83 per share quarterly dividend, in line with its previous distribution.
• Oracle increased its own dividend. Oracle advanced its dividend payout from $0.40 to $0.50 per share. 
• FDA made a big decision on weight loss drugs. Compounded versions of weight loss drugs including Wegovy and Zepbound will soon no longer be available after a decision by the U.S. Food and Drug Administration.
• How long will the stock slump last? “This is a headline driven market; one that could change in an hour,” said Gina Bolvin, President of Bolvin Wealth Management, on Monday. “We finally have the correction we were waiting for, and long-term investors will be rewarded again.”

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“With today’s additional decline, the S&P is very close to correction territory— that is, down 10% from its recent high of just three weeks ago. The Nasdaq got there last week. The longer this sell-off continues, the more economists will worry about ‘negative wealth effects’ compounding the pressure on growth from policy uncertainties.” - Mohamed El Erian 

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Most Active Stocks

• Asana (ASAN)
• Nio (NIO)
• Kohl's Corp. (KSS)
• Tesla (TSLA)
• Hesai Group (HSAI)
• Microsoft (MSFT)
• Oracle (ORCL)
• Super Micro Computers (SMCI)
• Nvidia (NVDA)
• Meta (META)

Weekly Notables

 

Rio Tinto Prepares Offer for Arcadium Lithium

According to Bloomberg News, Rio Tinto, the world's biggest iron ore producer, is offering $9 billion in U.S. investment-grade bonds as the miner seeks funding for its recently-closed buyout of Arcadium Lithium. Rio is marketing the debt in eight parts and will include a long-term note with a maturity of 40 years, yielding 1.3% over Treasuries, Bloomberg said, citing a person familiar with the matter.

Meta to Test an In-house Chip for Training AI Systems

Reuters has reported that Facebook parent Meta is reportedly testing an in-house chip for training AI systems, a part of a strategy to reduce its reliance on hardware makers like Nvidia. Meta's chip is designed to handle AI-specific workloads, was manufactured in partnership with Taiwan-based firm TSMC. The company is piloting a "small deployment" of the chip and plans to scale up production if the test is successful.

Earnings Spotlight: Adobe

Adobe will report quarterly earnings after the stock market closes today.

An 8% stock price range is implied from the options market this week.

Adobe exceeded earnings expectations last quarter, but the stock price fell over $100 in a week. The company is expected to announce earnings-per-share of $4.97 on $5.66 billion in revenue.