There was a late rush of buying interest Friday that saved the day, but not the week. The Nasdaq Composite (-3.5%), Russell 2000 (-1.5%), and S&P 500 (-1.0%) all dropped 1.0% or more for the week, which was rankled by growth concerns and technically-charged selling.
The S&P 500 fell below its 50-day moving average, the Nasdaq Composite flirted with a break of its 200-day moving average, NVIDIA (NVDA) and Alphabet (GOOG) dropped below their 200-day moving averages, Tesla (TSLA) briefly traded below its 200-day moving average before rebounding, and Microsoft (MSFT) fell further below its 200-day moving average.
These are some of the more high-profile cases where the technicals generated some added waves for market participants, yet the crux of the trading matter revolved around fundamental constraints tied to earnings growth concerns and valuation.
That big move late Friday? It was more mechanical than technical or fundamental, with month-end pension fund rebalancing getting called out as the catalyst. We suppose there was some technical charge to it, though, with the Nasdaq flirting with a break of its 200-day moving average.
So, this new week begins with a bid of optimism that there will be some follow through to the recovery effort. Currently, the S&P 500 futures are up 23 points and are trading 0.4% above fair value, the Nasdaq 100 futures are up 145 points and are trading 0.7% above fair value, and the Dow Jones Industrial Average futures are up 106 points and are trading 0.2% above fair value.
There is some speculative buzz in the air following President Trump’s weekend announcement of a U.S. cryptocurrency strategic reserve that will include Bitcoin, Ether, Ripple, Solana, and Cardano. Bitcoin, which traded just above $78,000 at Friday’s low, is now just north of $93,000.
Not surprisingly, stocks like Coinbase (COIN), Robinhood Markets (HOOD), MicroStrategy (MSTR), and Riot Platforms (RIOT) are all seeing a nice pop in pre-market trading.
Many other stocks not tied to cryptocurrencies in whole, or in part, are also on the move.
The broader market is keying off suggestions that Canada and Mexico could potentially see some tariff relief following remarks from Treasury Secretary Bessent and Commerce Secretary Lutnick, who created an impression that Canada and Mexico may be able to avoid a full 25% tariff rate on March 4.
At the same time, the president has ordered an investigation, based on national security concerns, into imports of lumber and timber. That could come back around to hurt Canada.
This morning, though, the broader market is willing to focus more on the carrot part of the carrot-stick tariff approach.
Something else the market will be focused on later this morning is the February ISM Manufacturing PMI (Briefing.com consensus 50.7%; prior 50.9%) at 10:00 a.m. ET. That report will kick off a week of key economic data that will include the ISM Services PMI on Wednesday and the February Employment Situation Report on Friday.
There is going to be a lot of important ground covered this week. The first step today is a step in the right direction for a market that has been tripped up recently by fundamental and technical developments.
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Originally Posted March 3, 2025 – A good first step
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