Financial markets provided considerable consternation for investors in February. The risk sentiment that surged post-election has diminished, a flight to quality trade led to a significant drop in U.S. Treasury rates and stocks fell broadly, with the traditionally riskiest areas of the markets faring worse than others.1 Bitcoin, a very good indicator of market risk sentiment, fell approximately 20% in February.2 While earnings season was generally good, many of the big movers from 2024 were left battered and bruised.3
What remains is a market contending with multiple levels of economic and geopolitical uncertainties. Inflation is persistent, and stagflation has even been mentioned. The Trump administration’s attempt at fiscal prudence is challenging conventional wisdom and maybe even economic growth that has become increasingly influenced by government spending. Tariffs, trade deals and disputes seemingly dominate each day’s headlines with market-moving impact.
Heading into March, it feels as if the markets are at a fork in the road in some respects. Do we continue down a path of “March Madness,” or do we settle down into a nice, comfortable season that will allow hope to spring eternal? As they say, there is no rest for the weary along this journey. This upcoming, first week of March has a calendar filled with updated economic readings, Federal Reserve member commentary and another round of corporate earnings reports.4,5 Which path will the market take us on from here?
Sources:
1,2Bloomberg
3BNN Bloomberg – Stock Pickers’ Light Tech Holdings Are Blessing as Megacaps Fall; 2/26/25
4MarketWatch – U.S. Economic Calendar; as of 3/3/25
5Investors’ Business Daily – Earnings Calendar, Analyst Estimates And Stocks To Watch; 2/28/25
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