Market Recap – Friday, March 14, 2025

Stocks Rally to Close the Week on a High Note

US equities rebounded sharply on Friday, with the S&P 500 up 2.13%, Nasdaq gaining 2.61%, and the Dow rising 1.65%. The S&P posted its best session since November, though it still wrapped up its fourth consecutive weekly loss. The rally was broad-based, led by big tech, semiconductors, software, energy, financials, and industrials, while defensive sectors like healthcare, consumer staples, and telecom lagged. Gold settled above $3,000/oz for the first time ever, while Bitcoin rebounded 5.6% after a rough week.

What Drove the Market Rebound?

Despite the rally, there wasn’t a clear catalyst, but several factors contributed to the bounce:

• Oversold conditions: After weeks of heavy selling, dip buyers stepped in. Over 60% of S&P 500 stocks were below their 200-day moving averages coming into today.

• No new tariff headlines: The lack of fresh trade war escalations provided some relief. Reports of productive trade discussions between US and Canadian officials also helped sentiment.

• Government shutdown fears eased: Senate Majority Leader Schumer signaled support for the House-passed spending bill, reducing shutdown risks.

• Positive global sentiment: A rally in Chinese equities on new stimulus pledges and Germany’s increased infrastructure and defense spending provided a global tailwind.

Economic Data: Consumer Sentiment Crashes, Inflation Expectations Jump

The University of Michigan Consumer Sentiment Index fell sharply to 57.9, well below expectations (64.0) and marking its lowest level since November 2022. The drop was largely driven by policy uncertainty, inflation concerns, and weaker consumer outlooks. More troublingly, inflation expectations jumped, with the 1-year outlook rising to 4.9% from 4.3%. This could complicate the Federal Reserve’s decision next week, as rising inflation expectations may slow its timeline for potential rate cuts.

Notable Earnings and Stock Moves

• Winners:

  • Rubrik (RBRK) +27.8%: Strong earnings, revenue beat, and growth in Security Cloud adoption.

  • Semtech (SMTC) +21.1%: Solid datacenter demand drove a strong Q4 report.

  • PagerDuty (PD) +17.8%: Beat revenue estimates and announced a $150M buyback.

  • Peloton (PTON) +16.1%: Upgraded to Buy at Canaccord on turnaround potential.

  • Ulta Beauty (ULTA) +13.7%: Strong Q4 earnings, loyalty program growth, and a “better-than-feared” FY outlook.

• Losers:

  • Xponential Fitness (XPOF) -38.5%: Disappointing earnings, financial restatements, and a downgrade at Stifel.

  • Abbott Labs (ABT) -2.5%: A judge overturned a prior not-liable verdict in a lawsuit.

  • T-Mobile (TMUS) -1.2%: Downgraded to Neutral at Citi over valuation concerns.

Here’s Our Take

While today’s bounce was a welcome relief, markets remain highly volatile and politically driven. Trump’s trade policies, consumer resilience, and Fed policy shifts will be key themes in the weeks ahead. With the S&P 500 now in correction territory, expect continued choppy price action, as traders weigh policy risks against long-term economic fundamentals.

Key Focus Next Week:

• FOMC decision & Powell’s press conference (Wednesday)

• Retail sales data (Monday) – a key consumer health check

• Geopolitical developments – US-Canada & US-China trade relations