Weekly market recap and what's ahead

24 to 28 February 2025

Key Takeaways

• Equities: Tech selloff deepened as Nvidia (-8.5%) dragged AI stocks; Trump tariffs on Canada, Mexico, and China rattled sentiment.
• Volatility: VIX spiked 10.6% midweek but eased as markets stabilized into Friday.
• Digital Assets: Bitcoin fell to $79.5K (-5.9%), with $800M liquidations; Trump’s crypto reserve announcement sparked a rebound.
• Fixed Income: US 10-year yield fell to 4.22%, pricing in Fed cuts amid trade fears.
• Commodities: Gold corrected to $2,856 as USD strength pressured metals; oil slumped below $69 on trade war concerns.
• Currencies: USD surged on Trump’s tariff threats; EUR, CAD, and JPY weakened against the greenback.

Market Recap (24 to 28 February 2025)

Equities

US equities sold off midweek as Trump’s 25% tariffs on Canada and Mexico were reaffirmed, with additional 10% tariffs on China announced. The Nasdaq 100 (-2.7%) had its worst session in months as Nvidia (-8.5%) led the decline post-earnings. AI and chip stocks suffered, dragging SOX (-2.1%) lower. Tesla (-8.1%) fell below a $1T market cap, while Palantir (-10.5%) extended losses.

European stocks faced tariff pressure, but the STOXX 50 (+1.5%) climbed late in the week, driven by AB InBev (+8.7%) and Munich RE (+4.8%). Auto stocks (Stellantis, BMW, Mercedes) plunged after Trump’s tariff threats, while defense stocks rallied on proposed €500B EU defense spending.

Asia saw a sharp decline, with the Hang Seng (-3.5%) and China CSI 300 (-0.77%) hit by fresh US restrictions on semiconductors and AI exports. Alibaba (-10.2%) and Baidu (-3.7%) tumbled. However, China’s 50.2 PMI reading hinted at an economic rebound.

Volatility

The VIX surged 10.6% midweek as the AI sector plunged, but settled to 19.63 (-7.1%) by Friday. Nasdaq 100 VIX spiked as Nvidia’s earnings disappointed, though futures rebounded into the weekend.

Digital Assets

Crypto markets collapsed midweek, with Bitcoin (-5.9%) falling to $79.5K and Ethereum (-8.1%) breaking below $2,300. ETF outflows surged, with BlackRock losing $420M in a single session. However, a sharp rally (+20%) on Friday followed Trump’s crypto reserve announcement, including Bitcoin, XRP (+31%), Solana (+15%), and Cardano (+69%).

Fixed Income

US Treasury yields fell sharply amid trade war fears. The 10-year yield hit 4.22%, its lowest level since December, as investors priced in two Fed rate cuts by September. Japanese bond yields rebounded, nearing 1.41% on inflation expectations.

Commodities

• Gold retreated to $2,856, with rising USD strength and profit-taking weighing on metals. Silver dropped to $31.15, extending its selloff.
• Oil prices collapsed, with WTI (-3.5%) falling below $69, despite US sanctions on Iran and OPEC+ delaying output hikes. Demand concerns outweighed supply risks.

Currencies

The USD strengthened as Trump’s trade war threats intensified.

• EUR/USD fell below 1.0400 before rebounding slightly on ECB rate cut speculation.
• CAD slumped, with USDCAD breaking 1.4350, as Canada faces 25% tariffs starting March 4.
• JPY weakened, despite Tokyo’s 2.2% inflation print, as USDJPY tested 151.00 resistance.

Looking Ahead (3 to 7 March 2025)

• Trump’s address to Congress (March 4): Focus on trade war rhetoric and economic policies.
• Tariffs take effect (March 4): Canada, Mexico, and China face new US tariffs—watch global market reaction.
• US Jobs Report (March 7): February payrolls in focus amid growing recession fears.
• Earnings: Broadcom, Costco, Target, Marvell, Zscaler, GitLab.
• Fed Speakers: Bowman, Williams, and Bostic give final remarks before FOMC blackout period.
• Crypto Summit (March 7): Trump to detail US crypto reserve strategy.

This week’s focus remains on trade war risks, economic data, and Fed policy expectations. Market sentiment hinges on Trump’s tariffs and Friday’s jobs report.

For more related content about last week's event, see:
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