Daily Market Report March 26th, 2025
The market stayed in a narrow range yesterday but with a late push to the upside once again after roaring the day before on hopes that the President’s tariffs may not be as sweeping as earlier feared.
The Dow eked out a small closing gain after being lower most of the session with a 4 point advance to 42,587 led by AAPL, GS and JPM. The S&P did a little better with a 9 point closing advance to 5776 following one of its best days of the year, as it was once again helped by gains in most of the large cap former tech leaders plus the financials once again. The Nasdaq did the best with an 84 point gain to 18, 271 obviously led by the tech former leaders with TSLA gaining for the fourth straight session after having lost almost 50% of its value this year.
The Russell 2000 fell by 13 down to 2095 as most buying was in the larger cap items while the VIX continued to fall as equities have generally moved up lately.
Stocks have gained back a chunk of their loses since dropping 10% below their all-time highs earlier this month for their first “correction” since 2023. The S&P is now down 6% from its record, and that drop has left the market looking less expensive than before, which had been a major criticism following its euphoric rise in earlier years.
But strategists warn that more sharp swings are still likely on the way with an April 2nd deadline looming. That’s what the President has called “Liberation Day,” when he will begin tariffs on trading partners that he says will roughly equal what he sees as the burden each of them puts on the United States. Monday’s huge spurt came on hopes that Trump’s “reciprocal” tariffs may be more targeted than had earlier been feared.
Even if his tariffs do end up being less painful for the global economy than feared, all the dizzying talk about them has already soured confidence among U.S. households and businesses. The fear is that could lead them to cut back on their spending and freeze the economy.
The Consumer Confidence report showed that pessimism among U.S. households is only worsening as it fell by more than expected, mostly because of a tumble for expectations about upcoming conditions in the short term. That dropped to its lowest level in 12 years and is sitting well below the threshold of 80 that usually signals a recession ahead. The overall number fell to 92.9 which was the lowest since January 2021.
Like other recent surveys, the data showed U.S. households are much more concerned about where the economy is heading than where it is currently. So far, actual economic activity and the job market seem to be holding up despite the worsening moods of U.S. companies and consumers.
DJT rose after the company behind the president’s Truth Social platform said it had reached an agreement with Crypto.com to offer a suite of “America-First” investment funds.
The exchange-traded funds will hold bitcoin and other digital assets, along with what TMTG called “securities with a Made in America focus spanning diverse industries such as energy.” Crypto.com will support the backend technology, provide custody and supply the cryptocurrencies for the ETFs, which will operate under TMTG’s Truth.Fi brand.
TSLA rose again after drifting between modest gains and losses following more grim sales figures from Europe, but Its stock nevertheless remains down nearly 29% for 2025 so far.
European sales of TSLA’s electric vehicles dropped by nearly half during the first two months of the year, compared with a year earlier, even as the overall market for battery-powered cars grew, according to the European Automobile Manufacturers Association.
In addition to an aging model line, drops in sales may be due in part to CEO Elon Musk’s endorsement of Germany’s far-right party in last month’s national election, his embrace of fringe political movements and a gesture during a President’s event in January that many saw as a Nazi salute. The company is also facing increasing competition from Chinese carmakers such as BYD.
KBH dropped after reporting weaker profit and revenue for the latest quarter than analysts expected. Already mired in a slump, homebuilders may face potentially rising costs due to tariffs, which they will have to pass on to buyers. A report on Tuesday morning said U.S. sales of new homes last month were slightly weaker than economists expected but did gain 1.8%.
In the bond market, Treasury yields eased. The yield on the 10-year Treasury fell to 4.31% from 4.34% late Monday.
Earnings this week will see: yesterday – MKC, PAYX, KBH lower, today – GME, CHWY, DLTR, SAIL higher and JEF lower; Thursday – WGO, LULU.
Economic reports will have: yesterday - March Consumer Confidence slipped to 92.9 which was the lowest since 2021, February new home sales gained 1.8%, Philly Fed Non-Manufacturing Survey fell in March to -32.5; today – February durable goods orders rose by 0.9%; Thursday – weekly jobless claims, final look at 4Q G.D.P.; Friday – the always important February P.C.E. Index, final March U. of Michigan Consumer Sentiment Index.
By. Don Selkin