Indices
- Dow 41,888, -1,313 or -3.07%.
- Nasdaq 17,754, -442 or -2.43%.
- S&P 5,638,-132 or -2.29%.
- MSCI EAFE2466.55, -29.18 or -1.17%.
- USD10Y4.308%, -0.9bp or -0.21%.
- WTI Crude $67.18/bbl, +$0.13or +0.19%.
The Beatings Will Continue Until Morale Improve
The market sell off continued last week and even a 2% dead cat bounce on Friday couldn’t mask the wreckage. The lowlights included...
- The CEOs of United, American, Delta, and Southwest Airlines all cited weaker demandand guided market expectations lower.
- The airlines weren’t alone as Oracle, Kohl’s, and Adobe all guided down as well.
- Goldman Sachs cut their 2025 GDP outlook from +2.4% to +1.7% citing the administration’s tariff policy (the Atlanta Fed GDP Now tool projects -2.4% Q1 growth). This is the first time since mid-2022 that Goldman’s estimate is below consensus.
- March Consumer Sentiment was worse than expected at 57.9 vs 63.2 and vs 65.7 last month.
- Tariffs – the administration flipped, flopped, bullied and threatened its way through multiple announcements leaving companies completely bewildered as to what to expect and how to plan going forward.
- Despite continuing to threaten to annex Greenland and place 200% tariffs on European wine and champagne, the administration is begging Europe to send eggs to the U.S.to assist with surging prices that the President can’t seem to stem; egg prices rose +59% in February, the President’s first full month in office.
As we stated last week, we executed a rare mid-cycle rebalance to our portfolios to reduce risk. Equities were cut from overweight to equal weight vs our benchmark. We eliminated our dedicated technology allocation. Quality and factor allocations were increased to emphasize earnings, dividends and clean balance sheets. Finally, while decreasing our exposures to emerging markets, we increased our positions indeveloped international. Our fixed income allocation remained unchanged.
The UpcomingWeek: Mar 17– Mar 21
Earnings laggards continue to report with FedEx, homebuilder Lennar, Micron Technology, Super Micro Computer and Carnival Cruises on the calendar. Economic data includes U.S. Retail Sales on Monday, the Federal Reserve’s interest rate decision (the market expects rates to remain unchanged) on Wednesday, and U.S. Leading Economic Indicators on Thursday.
Economic Calendar
- Monday – February U.S. Retail Sales.Earnings: N/A.
- Tuesday – N/A. Earnings: N/A.
- Wednesday – FOMC Interest Rate Decision, Fed Chair Powell Press Conference. Earnings: Super Micro Computer (SMCI).
- Thursday – Initial Jobless Claims.February U.S. Leading Economic Indicators. Earnings: FedEx (FDX), Lennar (LEN), Micron Technology (MU).
- Friday – N/A. Earnings: Carnival Cruises (CCL).
If you know of any friends or family members who could benefit from our services and these types of communiques, we are accepting new clients and offer a complimentary one-hour review.
Disclaimer: This is not a recommendation to buy or sell any of the securities listed above. I personally, or a family member whose account I control, have positions in the following securities/assets...Bitcoin, Ethereum, Solana, ACHR, BITB, NVDA, and RIVN.