Market Drama
Featuring Zoe CEO & Founder, Andres Garcia-Amaya, CFA
March 10th, 2025
Welcome to this week’s Market Drama!
Stock Market Update:
- S&P 500: Down 3.1% for the week, now down 1.9% YTD.
- Nasdaq: Down 3.5% for the week, now down 5.8% YTD, dragged by the tech sector.
- MSCI EAFE (Intl. Developed Markets): Up 3.5% for the week, now up 10.9% YTD.
- MSCI Emerging Markets: Up 5.5% YTD.
- Market Rotation: Investors shifting from growth sectors like tech into defensive sectors and international stocks as global markets outperform U.S. equities.
- Trade Policy Uncertainty: Markets are reacting to the March 5th tariff deadline on Canada, Mexico, and China, despite some exemptions and delays.
- Tariffs & Consumption Impact: Proposed tariffs would affect 18% of U.S. imports, reaching levels seen in the 1930s. Since consumption makes up 70% of the GDP, this raises recession concerns.
- Earnings Expectations Falling:
- Q4 2024 S&P 500 earnings: +18% YoY (strongest since 2021).
- Q1 2025 earnings forecast: Dropped from 11.5% to 7.3% growth.
- Jobs Data:
- February Payrolls: 151,000 jobs added (below 159,000 forecast).
- Unemployment Rate: 4.1% (slight uptick).
- Takeaway: Job market slowing but not at recession levels yet.
- Market Uncertainty: Investors are weighing whether this is a market correction or early signs of a recession as economic data shifts.
Stay tuned for next week.
– Andres
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