March 4, 2025
S&P futures -0.1% after Monday’s sharp selloff, where the S&P 500 fell over 1.5%, marking its worst day of the year. Nvidia (NVDA) led the Mag 7 downturn, while cyclicals underperformed defensives by 450 bp. Treasuries mixed, dollar -0.4%, gold +0.8%, Bitcoin -2.4%, WTI crude -0.9% after Monday’s 2% drop on OPEC+ production hike.
Markets await Trump’s State of the Union tonight and key macro data this week. Concerns include trade policy uncertainty, slowing U.S. data, AI sector scrutiny, rising volatility (VIX), momentum unwind, weak cyclical earnings trends, and government shutdown risks. However, some expect Trump to soften tariff threats, while Fed easing expectations (75 bp cuts priced in), strong corporate buybacks, and resilient hard data could provide support.
Key Events This Week
- Today: NY Fed President Williams (2:20 PM ET), Trump’s State of the Union (9:00 PM ET).
- Wednesday: ADP payrolls, ISM services, factory orders, Beige Book.
- Thursday: Trade balance, Q4 productivity, jobless claims.
- Friday: February jobs report, Fed speakers (Powell, Williams, Kugler).
Corporate Highlights
- Target (TGT) +3.2%: Q4 beat, 2025 EPS guidance slightly ahead, but cautious consumer outlook.
- On Holding (ONON) +5.1%: Q4 beat, cited strong brand momentum.
- Okta (OKTA) +12.4%: Post-earnings jump on 15% cRPO growth, strong FY26 revenue/margin guidance.
- GitLab (GTLB) +9.3%: Q4 beat, noted large deal strength, Duo outperformance.
- Albertsons (ACI) +1.8%: Named Susan Morris as new CEO, reaffirmed guidance.
- Walgreens (WBA) +4.7%: Reportedly near $10B buyout deal with Sycamore Partners.
- NuScale Power (SMR) -6.1%: Post-earnings drop, lack of customer interest clarity.
- Dave Inc. (DAVE) +8.5%: Q4 beat, FY EBITDA guidance ahead of expectations.
U.S. equities saw sharp declines on Monday (Dow -1.48%, S&P 500 -1.76%, Nasdaq -2.64%, Russell 2000 -2.81%), with the S&P 500 posting its worst day since early January and the Nasdaq extending its biggest selloff since September. The S&P 500 dropped 1.76%, giving back Friday’s gains and continuing February’s downtrend. Treasuries firmed, with some curve flattening, while the dollar index fell 0.9%. Gold surged 1.9%, climbing back above $1,900/oz, while Bitcoin futures dropped 7.5%, reversing Sunday’s 10% rally tied to Trump’s U.S. Crypto Reserve announcement. WTI crude fell 2% after OPEC+ confirmed its April production hike.
The selloff was largely driven by renewed Trump 2.0 policy uncertainty, with investors reacting negatively to Trump’s confirmation that 25% tariffs on Canada and Mexico will take effect today (March 4), alongside a 10% tariff increase on China. Additionally, Trump signed an executive order raising tariffs on China to 20% and announced April 2 tariffs on agricultural imports and potential new lumber tariffs.
Markets were also pressured by momentum unwinds in big tech, particularly Nvidia (NVDA -8.8%), which extended its post-earnings slide on concerns over China-related chip restrictions. Economic data contributed to growth concerns, with February ISM Manufacturing falling to 50.3 (below estimates), new orders contracting, and prices paid surging to 62.4 (from 54.9), reinforcing sticky inflation worries. Meanwhile, January construction spending fell 0.2%, and the Atlanta Fed GDPNow model cut Q1 growth to -2.8%, deepening recession fears.
Looking ahead, investors are watching Trump’s State of the Union address tonight, along with key economic releases later this week, including ADP private payrolls, ISM services, factory orders, trade balance, jobless claims, and Friday’s February employment report.
Sector Performance & Corporate News
Technology (-3.52%)
- Nvidia (NVDA -8.8%): Continued post-earnings selloff amid worries about China chip restrictions, with Mizuho estimating potential $4-5B revenue impact from new export bans.
- Intel (INTC +2.1%): Gained on reports that NVDA and Broadcom (AVGO) are testing its 18A process for semiconductor manufacturing.
- Super Micro Computer (SMCI +1.3%): Announced plans for third campus expansion in Silicon Valley.
- AppLovin (APP +3.6%): Modified its buyback program, increasing repurchases by $500M and adding flexibility for future purchases.
Consumer Discretionary (-2.31%)
- Tesla (TSLA -1.8%): Fell as European sales declined 25% YoY, while Morgan Stanley remained positive on its long-term AI and autonomous vehicle strategy.
- Capri Holdings (CPRI +3.9%): Prada reportedly nearing a $1.6B acquisition deal for Versace.
- Las Vegas Sands (LVS +1.6%): Macau February gaming revenue rose 7% YoY, but growth lagged expectations due to weaker Chinese New Year spending.
Energy (-3.51%)
- OPEC+ confirmed it will move forward with an April production hike, sending crude prices lower.
- Canada’s energy minister warned U.S. tariffs could raise gas and electricity prices.
- Sunnova Energy (NOVA -64.3%): Collapsed after warning its cash reserves and financing agreements are insufficient to sustain operations.
- SolarEdge Technologies (SEDG -14.3%): CFO Ariel Porat resigned, replaced by Delta Galil’s former CEO.
Industrials (-1.45%)
- Fortrea Holdings (FTRE -25.1%): Q4 revenue down 5.1% YoY, FY25 outlook well below expectations.
- Honda reportedly shifting Civic production from Mexico to Indiana to avoid U.S. tariffs.
Materials (-2.09%)
- Lumber futures surged to their highest level since August 2022, as Trump ordered a national security investigation into lumber imports.
- Canada’s oilfield drilling sector showing signs of slowing due to U.S. tariffs.
Financials (-0.86%)
- Kroger (KR -3.0%): CEO Rodney McMullen resigned following a board investigation into personal conduct; company reaffirmed higher-end FY comps and EPS guidance.
- State Street (STT -1.2%): Investing division abandoned DEI-related board diversity targets due to political backlash.
Healthcare (+0.35%)
- Acadia Healthcare (ACHC -25.5%): Q4 earnings missed, FY25 guidance weak, and company lowered long-term adjusted EBITDA growth target.
- Recursion Pharmaceuticals (RXRX -2.1%): Q4 earnings missed expectations, flagged delays in Roche and Genentech collaborations.
Real Estate (+0.77%)
- Howard Hughes (HHC -0.8%): Board rejected Bill Ackman’s takeover bid as “not acceptable”.
Communication Services (-1.36%)
- Endeavor Group (EDR -10.7%): Silver Lake’s acquisition set to close at $27.50/share, 15% below Friday’s close but a 57% premium to October levels
Tariffs & Trade Policy
- Trump confirmed 25% tariffs on Canada & Mexico start today (March 4).
- China tariffs increased to 20% with additional 10% on tech and autos.
- April 2 tariffs set for agricultural imports (details pending).
- Lumber imports under national security review.
- Mexico said it has a backup plan if tariffs are enacted.
Economic Data & Fed Commentary
- February ISM Manufacturing Index fell to 50.3 (vs. 50.5 expected), with new orders contracting (48.6) and prices paid surging (62.4).
- January construction spending declined 0.2%, missing estimates.
- Atlanta Fed GDPNow cut Q1 growth to -2.8%, raising recession concerns.
- St. Louis Fed’s Musalem warned of “downside risks to U.S. economic growth.”
Geopolitics & Washington
- Trump’s State of the Union speech tonight could signal future policy moves.
- White House considering sanctions relief for Russia.
- Trump reaffirmed a minerals deal with Ukraine is still possible despite tensions.
Crypto & Markets
- Trump’s U.S. Crypto Reserve plan faced backlash, adding volatility to Bitcoin.
- 0DTE (zero-day options) trading volumes hit record highs in February amid Trump policy uncertainty
Eco Data Releases | Tuesday March 4th, 2025
S&P 500 Constituent Earnings Announcements | Tuesday March 4th, 2025
No constituents report today
Data sourced from FactSet Research Systems Inc.
