Market Recap – Monday, March 10, 2025: Worst Day of the Year for Stocks
Broad Selloff as Markets Extend Declines
U.S. equities suffered another sharp selloff on Monday, with the S&P 500 (-2.70%) and Nasdaq (-4.00%) posting their worst sessions of 2025. The Nasdaq is now down ~14% from its December high, while the S&P 500 has fallen ~9% since its February peak. The decline followed last week's heavy losses, marking the worst weekly performance for the S&P since early September.
The "Magnificent 7" tech stocks were all deep in the red, led by Tesla (TSLA), semiconductors, and software.Other big losers included credit card firms, banks, travel/tourism, and China tech. Meanwhile, defensive sectors such as REITs, utilities, healthcare, and consumer staples outperformed as investors rotated into safer assets.
Key Market Drivers: Growth Concerns, Tariffs, and a Defensive Shift
Growth Concerns Deepen: The market continues to wrestle with slowing economic momentum after a string of weaker data points. The Citi Economic Surprise Index has been negative since mid-February, reflecting downside risks to consumer spending.
Trade Uncertainty Lingers: Tariff headlines remain a dominant overhang. While Trump reaffirmed his aggressive trade stance, his recent comments about a potential "period of transition" and Treasury Secretary Bessent’s mention of an economic "detox period" added to fears of a policy-driven slowdown.
The “Trump Put” Looks Out of Reach: Despite market weakness, Trump has downplayed equity performance, focusing instead on long-term policy objectives. This has eroded investor confidence that his administration will act quickly to cushion market volatility.
Treasuries, Commodities, and Crypto React
Treasuries rallied as investors sought safety, with yields falling across the curve after last week’s sharp rise.
The U.S. dollar ticked up (+0.2%) following its worst week since November 2022, reflecting a risk-off environment.
Gold (-0.5%) declined, failing to benefit from risk aversion as investors prioritized cash and Treasuries.
Bitcoin (-9.6%) plunged below $80K, marking its biggest one-day drop in months as traders rushed to de-risk.
WTI crude (-1.5%) declined, reversing early gains despite geopolitical tensions.
Major Movers: M&A, Earnings, and Downgrades
Notable Gainers:
+67.9% RDFN (Redfin): To be acquired by Rocket Companies (RKT) in an all-stock deal valued at ~$1.75B (115% premium).
+45.9% PTGX (Protagonist Therapeutics): Announced strong Phase 3 results for oral icotrokinra in plaque psoriasis.
+6.7% BECN (Beacon Roofing Supply): Confirmed discussions on a potential transaction with QXO.
+3.6% CBRL (Cracker Barrel): Upgraded to Buy at Truist; cited turnaround progress and pricing power.
Notable Decliners:
-15.4% RKT (Rocket Companies): Shares dropped on concerns over the price paid for RDFN acquisition.
-9.4% NVO (Novo Nordisk): CagriSema weight loss drug trial results fell short of expectations.
-9.2% DXCM (Dexcom): Hit by FDA warning letter regarding compliance issues at manufacturing facilities.
-7.9% NOW (ServiceNow): Sold off after announcing a ~$2.9B acquisition of AI startup Moveworks.
Macro Outlook: Key Events This Week
Tuesday: January JOLTS job openings
Wednesday: February CPI report (inflation remains a key market driver)
Thursday: Producer Price Index (PPI) & weekly jobless claims
Friday: Preliminary March University of Michigan Consumer Sentiment
The February CPI print on Wednesday is the week’s most critical data release, with markets watching for signs of sticky inflation that could impact Fed rate cut expectations.
Investment Takeaways: Navigating the Volatility
Defensive Rotation Is in Play: Investors are favoring utilities, healthcare, and consumer staples—a classic late-cycle signal.
Tech Faces a Reset: The AI and semiconductor trade is undergoing a painful de-leveraging, but long-term secular growth remains intact.
Liquidity Matters: With markets in a de-risking phase, raising cash and being selective with new positions can help mitigate downside risks.
CPI Is the Next Market Catalyst: Inflation data on Wednesday could determine whether the Fed remains on track for rate cuts—or if markets need to recalibrate expectations.
Volatility is likely to remain elevated, but staying disciplined and focusing on quality, cash flow, and valuation opportunities will be key to navigating this downturn.