March 19, 2025
S&P futures up 0.1% Wednesday morning after Tuesday’s pullback, which ended a brief two-day bounce. Big tech underperformed, with all Mag 7 stocks now down YTD and the group off more than 16%. Asian and European markets mixed. Treasuries steady, dollar up 0.4%, gold down 0.2%, and Bitcoin up 2.0%. WTI crude down 0.9%, extending Tuesday’s losses despite Middle East tensions.
Markets remain quiet ahead of today’s FOMC decision (2:00 PM ET) and Powell’s press conference. Fed expected to hold rates steady, with the SEP likely to show lower 2025 growth forecasts and higher inflation expectations, while still signaling two cuts this year. The market is pricing in ~60 bp of easing. Trade policy remains the dominant narrative, with Trump’s April 2 reciprocal tariff announcement looming.
Other headlines:
- BoJ left policy unchanged, with a dovish statement.
- Trump-Putin Ukraine ceasefire talks ongoing but not impacting markets.
- Nothing on the US economic calendar pre-FOMC.
Notable Corporate Developments
- TSLA gained approval in California to begin carrying passengers, moving closer to ride-hailing services.
- GILD lower on reports HHS considering major cuts to HIV prevention funding.
- FI to acquire European payment provider CCV.
- Starboard Value planning a proxy fight at ADSK, per Reuters.
- HQY fell post-earnings despite a revenue beat; higher cybersecurity costs and weak FY26 EBITDA guide.
- GEF announced price increases for several products
U.S. equities closed lower Tuesday, with the S&P 500 down 1.07%, breaking its two-day winning streak. Big tech underperformed, continuing the recent trend of Mag 7 weakness, with TSLA sliding on China EV competition concerns and GOOGL declining after confirming a $30B+ Wiz acquisition. NVDA also dipped despite its GTC event. Other underperformers included semis, software, airlines, P&C insurers, and travel/tourism, while managed care, energy, media, credit cards, banks, and healthcare distributors outperformed.
Treasuries were unchanged to firmer at the short end following a well-received $13B auction of 20-year bonds. Dollar index dipped 0.1%, while gold gained 1.2% amid geopolitical tensions. Bitcoin futures fell 2.9%. WTI crude reversed early gains, settling down 0.9% despite concerns over Middle East tensions and the Trump-Putin call on Ukraine ceasefire.
Market sentiment remains skeptical about the recent bounce, with investors focused on the April 2 reciprocal tariff decision and uncertainty surrounding its implementation. The BofA Global Fund Manager Survey revealed a record decline in U.S. equity exposure, with a 23% underweight, the lowest since June 2023. The report highlighted stagflation concerns, trade war fears, and a shift toward Eurozone stocks.
Economic data was mixed:
- Housing starts beat expectations at 1,501K SAAR vs. 1,385K consensus, with permits largely in line.
- Import prices rose 0.4% m/m, higher than the -0.1% expected, while export prices increased 0.1% following January’s 1.3% rise.
- Industrial production came in weaker than forecast.
Geopolitical developments were in focus, with Trump and Putin holding a 90-minute call on Ukraine, discussing a phased ceasefire approach, though details remain vague. Germany’s lower house approved changes to its debt brake, with the upper house set to vote Friday.
Looking ahead, the market is focused on Wednesday’s FOMC decision, the updated SEP, and Powell’s press conference. Previews suggest lower growth, higher inflation in the SEP, with the 2025 median dot likely to remain unchanged at two rate cuts.
Sector Performance & Company-Specific News
Technology (-1.65%)
- NVDA declined despite its GTC keynote highlighting pipeline updates.
Communications Services (-2.01%)
- GOOGL confirmed its $30B+ cash acquisition of cybersecurity startup Wiz
Consumer Discretionary (-1.90%)
- AMZN reportedly considering cutting 14K managerial positions by March-end and offering AI chips at lower prices than NVDA.
- TSLA fell 5.3% after China EV maker BYD introduced five-minute charging technology.
Energy (+0.22%)
- BTU (Peabody Energy) +6.2% and other coal stocks gained after Trump authorized increased coal production, calling it “clean and beautiful”.
Healthcare (+0.12%)
- SRPT plunged 27.4% after a patient died from liver failure while taking its Duchenne muscular dystrophy treatment. The company said it will update prescribing information.
- INCY fell 3.2% after disappointing clinical update on its JAK inhibitor for hidradenitis suppurativa (HS).
Industrials (+0.77%)
- ALGT dropped 3.3% after guiding Q1 EPS to the low end of prior range, citing soft leisure demand and reducing its FY capacity growth forecast
- ESLT (Elbit Systems) +10.6% after Q4 EPS and revenue beat, dividend hike, and strong aerospace revenue growth.
- Siemens announced it will cut 6,000 jobs in automation and EV charging units.
Financials (+0.13%)
- WFC confirmed that the OCC terminated its 2021 consent order.
- DFS fell 6.9% after reports that DOJ staff found its merger with COF could be anticompetitive in the subprime sector.
Real Estate (+0.64%)
- IIPR (Innovative Industrial Properties) -7.8% after major tenant PharmaCann defaulted on March rent payments.
Eco Data Releases | Wednesday March 19th, 2025
S&P 500 Constituent Earnings Announcements | Wednesday March 19th, 2025
Data sourced from FactSet Research Systems Inc.
