Market Update—Week of March 10, 2025

Posted on March 13, 2025 by George Gallagher

Presented by Mark Gallagher

The economy added a solid 151,000 jobs in February. Concerns over economic softening and tariff volatility affected U.S. stocks. Data this week will focus on small business confidence, inflation, and consumer sentiment.

Quick Hits

Report releases: The economy added a solid 151,000 jobs last month.
Financial market data: Concerns over economic softening and tariff volatility weighed on U.S. stocks.
Looking ahead: Data this week will focus on small business confidence, inflation, and consumer sentiment.

Keep reading for an in-depth look.

Report Releases—March 3–7, 2025

ISM Manufacturing Index: February (Monday)
Although manufacturer confidence fell slightly more than expected, the index remained in expansionary territory for the second consecutive month.

Expected/prior ISM Manufacturing index: 50.7/50.9
Actual ISM Manufacturing index: 50.3

ISM Services Index: February (Wednesday)
The second estimate of fourth-quarter GDP matched expectations at 2.3 percent quarter-over-quarter. The Federal Reserve’s (Fed’s) favorite inflation gauge, the core Personal Consumption Expenditures (PCE) Price Index, rose 2.7 percent quarter-over-quarter, higher than the expected 2.5 percent increase.

Expected/prior ISM Services index: 52.5/52.8
Actual ISM Services index: 53.5

U.S. Trade Balance: January (Thursday)
The U.S. trade deficit widened more than expected in January. It’s been reported that importers are trying to increase inventory amid tariff concerns. That is worth watching because it could hurt first-quarter GDP.

Expected/prior U.S. trade balance: –$128.7 billion/–$98.1 billion
Actual U.S. trade balance: –$131.4 billion

Employment Report: February (Friday)
Hiring improved in February, with 151,000 jobs added during the month. The unemployment rate rose to 4.1 percent.

Expected/prior change in nonfarm payrolls: +160,000/+125,000
Actual change in nonfarm payrolls: +151,000

The Takeaway

Service sector confidence was better than expected last month, whereas manufacturing was a bit light.
Although employment was slightly lower than expected, it exceeded January’s figure.

Financial Market Data

Equity

Index	Week-to-Date	Month-to-Date	Year-to-Date	12-Month
S&P 500	–3.06%	–3.06%	–1.67%	13.36%
Nasdaq Composite	–3.43%	–3.43%	–5.66%	12.62%
DJIA	–2.33%	–2.33%	0.91%	12.27%
MSCI EAFE	3.12%	3.12%	10.69%	9.81%
MSCI Emerging Markets	2.89%	2.89%	5.27%	12.72%
Russell 2000	–4.01%	–4.01%	–6.76%	0.89%

Source: Bloomberg, as of March 7, 2025

U.S. equities, facing a softening economic picture and volatility around tariffs, moved lower. Tesla and Nvidia were down considerably, falling 10.4 percent and 9.8 percent, respectively. Artificial intelligence (AI) names such as Marvell Technology sold off more than 22 percent; AI capital expenditures came under question as Alibaba unveiled an efficient model to rival Chinese competitor DeepSeek. Defensive names fared better, with health care, materials, and consumer staples among the top performing sectors. Financials, consumer discretionary, energy, and technology were among the worst performers.

Fixed Income

Index	Month-to-Date	Year-to-Date	12-Month
U.S. Broad Market	1.21%	2.15%	4.08%
U.S. Treasury	1.19%	2.11%	3.37%
U.S. Mortgages	1.48%	2.45%	4.56%
Municipal Bond	0.03%	0.97%	2.03%

Source: Bloomberg, as of March 7, 2025

Bonds were mixed, with a sell-off in long-term bonds but a rally in bonds and bills with maturities of less than 2 years. The 10-year Treasury yield rose 9 basis points (bps), closing the week at 4.32 percent.

The Takeaway

Economic softening and tariff volatility led U.S. equities lower.
The bond market seems to have increased its expectations for cuts in 2025.

Looking Ahead

This week, data will focus on small business confidence, inflation, and consumer sentiment.

On Tuesday, things kick off with the release of the NFIB Small Business Optimism Index for February. Confidence ticked down slightly last month after a strong uptick to end 2024.
The Consumer Price Index (CPI) for February is set to be released Wednesday. Economists expect to see modest improvements in headline and core consumer inflation.
On Thursday, the Producer Price Index (PPI) for February will be released. Producer inflation is expected to fall modestly.
Finally, on Friday, the Preliminary University of Michigan consumer sentiment survey for March will be released. Sentiment is expected to fall.

Disclosures: This material is intended for informational/educational purposes only and should not be construed as investment advice, a solicitation, or a recommendation to buy or sell any security or investment product. Please contact your financial professional for more information specific to your situation.

Certain sections of this commentary contain forward-looking statements that are based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. All indices are unmanaged and are not available for direct investment by the public. Past performance is not indicative of future results. The S&P 500 is based on the average performance of the 500 industrial stocks monitored by Standard & Poor’s. The Nasdaq Composite Index measures the performance of all issues listed in the Nasdaq Stock Market, except for rights, warrants, units, and convertible debentures. The Dow Jones Industrial Average is computed by summing the prices of the stocks of 30 large companies and then dividing that total by an adjusted value, one which has been adjusted over the years to account for the effects of stock splits on the prices of the 30 companies. Dividends are reinvested to reflect the actual performance of the underlying securities. The MSCI EAFE Index is a float-adjusted market capitalization index designed to measure developed market equity performance, excluding the U.S. and Canada. The MSCI Emerging Markets Index is a market capitalization-weighted index composed of companies representative of the market structure of 26 emerging market countries in Europe, Latin America, and the Pacific Basin. The Russell 2000^® Index measures the performance of the 2,000 smallest companies in the Russell 3000^® Index. The Bloomberg US Aggregate Bond Index is an unmanaged market value-weighted performance benchmark for investment-grade fixed-rate debt issues, including government, corporate, asset-backed, and mortgage-backed securities with maturities of at least one year. The U.S. Treasury Index is based on the auctions of U.S. Treasury bills, or on the U.S. Treasury’s daily yield curve. The Bloomberg US Mortgage Backed Securities (MBS) Index is an unmanaged market value-weighted index of 15- and 30-year fixed-rate securities backed by mortgage pools of the Government National Mortgage Association (GNMA), Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (FHLMC), and balloon mortgages with fixed-rate coupons. The Bloomberg US Municipal Index includes investment-grade, tax-exempt, and fixed-rate bonds with long-term maturities (greater than 2 years) selected from issues larger than $50 million. One basis point is equal to 1/100th of 1 percent, or 0.01 percent. One basis point (bp) is equal to 1/100th of 1 percent, or 0.01 percent.

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Authored by the Investment Research team at Commonwealth Financial Network^®.

Market Update for the Week of February 18, 2025

Posted on February 19, 2025 by George Gallagher

Presented by Mark Gallagher

Consumer and producer prices rose more than expected, leading to questions about the potential reacceleration of inflation. In equity markets, technology (paced by Nvidia and Apple) and international stocks led the way. The Treasury yield curve was little changed.

Quick Hits

Report releases: Consumer and producer prices rose more than expected.
Financial market data: Led by Nvidia and Apple, technology stocks bounced back.
Looking ahead: Economic releases this week will focus on housing and the Federal Reserve (Fed).

Keep reading for an in-depth look.

Report Releases—February 10–14, 2025

National Federation of Independent Business (NFIB) Small Business Optimism: January (Monday)
Small business optimism fell 2.3 points as plans for making capital outlays and increasing inventories dropped. Expectations for improvement in the economy also fell, from 52 percent to 47 percent.

Expected/prior NFIB small business optimism: 104.6/105.1
Actual NFIB small business optimism: 102.8

Consumer Price Index (CPI): January (Wednesday)
Consumer inflation continued to accelerate, with headline and core prices rising more than expected.

Prior monthly CPI/core CPI growth: +0.4%/+0.2%
Expected monthly CPI/core CPI growth: +0.3%/+0.3%
Actual monthly CPI/core CPI growth: +0.5%/+0.4%
Prior year-over-year CPI/core CPI growth: +2.9%/+3.2%
Expected year-over-year CPI/core CPI growth: +2.9%/+3.1%
Actual year-over-year CPI/core CPI growth: +3.0%/+3.3%

Producer Price Index (PPI): January (Thursday)
Headline and core producer inflation increased more than expected.

Prior monthly PPI/core PPI growth: +0.2%/+0.0%
Expected monthly PPI/core PPI growth: +0.3%/+0.3%
Actual monthly PPI/core PPI growth: +0.4%/+0.3%
Prior year-over-year PPI/core PPI growth: +3.3%/+3.5%
Expected year-over-year PPI/core PPI growth: +3.3%/+3.3%
Actual year-over-year PPI/core PPI growth: +3.5%/+3.6%

Retail Sales: January (Friday)
Retail sales unexpectedly slumped, marking the largest monthly decline in more than two years. The dip was widespread, with 9 of 13 categories experiencing falling sales.

Expected/prior month retail sales monthly change: –0.2%/+0.4%
Actual retail sales monthly change: –0.9%

The Takeaway

The biggest news was the CPI and PPI being hotter than expected, leading to concerns that inflation may be reaccelerating.
Small business optimism ticked lower, and retail sales posted a notable miss.

Financial Market Data

Equity

Index	Week-to-Date	Month-to-Date	Year-to-Date	12-Month
S&P 500	1.52%	4.11%	4.11%	23.93%
Nasdaq Composite	2.60%	3.76%	3.76%	27.18%
DJIA	0.65%	4.89%	4.89%	18.14%
MSCI EAFE	2.91%	8.74%	8.74%	12.37%
MSCI Emerging Markets	2.01%	5.31%	5.31%	14.47%
Russell 2000	0.05%	2.33%	2.33%	14.85%

Source: Bloomberg, as of February 14, 2025

The technology-oriented Nasdaq Composite bounced back on the strength of Nvidia and Apple, which each rose at least 6.9 percent. Semiconductor manufacturers (and Apple) were buoyed after Apple reached a deal with Alibaba to provide AI to iPhone users in China. Dell also announced a $5 billion deal with Elon Musk’s xAI. International markets continued their strong start to the year, with the developed international MSCI EAFE benchmark up 2.91 percent. In addition to technology, communication services and materials fared well. Lagging sectors included health care, financials, and industrials.

Fixed Income

Index	Month-to-Date	Year-to-Date	12-Month
U.S. Broad Market	1.14%	1.12%	4.48%
U.S. Treasury	1.03%	1.00%	3.69%
U.S. Mortgages	1.23%	1.20%	4.83%
Municipal Bond	1.75%	0.71%	2.50%

Source: Bloomberg, as of February 14, 2025

Treasury yields changed very little over the week. The 2-, 5-, 10-, and 30-year all moved less than 2 basis points (bps).

The Takeaway

Technology stocks led the way in the U.S., with Nvidia and Apple posting large moves.
The Treasury yield curve didn’t move much despite midweek volatility caused by inflation data.

Looking Ahead

Economic data and releases this week will primarily focus on housing and the Fed.

On Tuesday, the National Association of Home Builders (NAHB) Housing Market Index for February will be released. Home builder confidence is expected to remain unchanged.
On Wednesday, we expect the release of housing starts and building permits for January as well as last month’s Federal Open Market Committee (FOMC) meeting minutes. Housing starts and building permits are set to slow after mixed results in December. Economists and investors will closely analyze minutes from the FOMC meeting to better understand the rationale behind the central bank’s decision to pause rate cuts to start the year.
Finally, on Friday, we expect the release of existing home sales for January. The pace of existing home sales is expected to slow.

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Authored by the Investment Research team at Commonwealth Financial Network^®.

Market Update for the Week of January 27, 2025

Posted on January 31, 2025 by George Gallagher

Presented by Mark Gallagher

Economic data was mixed, with stronger-than-expected existing home sales and a softer-than-expected Purchasing Managers Index (PMI). International markets fared well, thanks to a softer U.S. dollar and better-than-feared tariff policy. Bonds were little changed.

Quick Hits

Report releases: Existing home sales grew for the third consecutive month.
Financial market data: International markets led the way on a softer U.S. dollar and better-than-feared tariff policy.
3. Looking ahead: Economic data will focus on consumer confidence, interest rates, economic growth, and personal income and spending.

Keep reading for an in-depth look.

Report Releases—January 21–24, 2025

U.S. Leading Economic Index (LEI): December (Wednesday)
As expected, the LEI softened slightly, declining 1.3 percent in the second half of 2024. The index was down because of lower confidence about future business conditions, soft manufacturing orders, and a slight uptick in unemployment claims.

Prior/expected LEI change: +0.3%/–0.1%
Actual LEI change: –0.1%

Initial Jobless Claims: December (Thursday)
Seasonally adjusted jobless claims were slightly higher than expected, up 9,500 from their four-week moving average of 213,500.

Prior weekly jobless claims/expected weekly jobless claims: 217,000/221,000
Actual weekly jobless claims: 223,000

Existing Home Sales: December (Friday)
Existing home sales rose for the third consecutive month, though the pace of sales remained subdued on a historical basis.

Expected/prior month existing home sales change: +1.2%/+4.8%
Actual existing home sales change: +2.2%

S&P Flash US PMIs: January (Friday)
The S&P Global US Composite PMI dipped from 55.4 to 52.4. Services led the softening, dropping from 56.8 to 52.8; conversely, manufacturing increased from 49.4 to 50.1, entering expansionary territory.

The Takeaway

Economic data was mixed, with stronger-than-expected existing home sales and relatively stable jobless claims.
The LEI and the U.S. services sector showed mild signs of softening.

Financial Market Data

Equity

Index	Week-to-Date	Month-to-Date	Year-to-Date	12-Month
S&P 500	1.76%	3.80%	3.80%	27.03%
Nasdaq Composite	1.65%	3.35%	3.35%	29.84%
DJIA	2.19%	4.50%	4.50%	19.69%
MSCI EAFE	3.17%	4.43%	4.43%	9.93%
MSCI Emerging Markets	1.87%	1.48%	1.48%	14.14%
Russell 2000	1.40%	3.51%	3.51%	19.23%

Source: Bloomberg, as of January 24, 2025

Equities in global markets continued their recent move higher. International markets led the way; a weakening U.S. dollar and a slower (or potentially lighter) rollout of tariffs were factors. President Trump threatened a 10 percent tariff on China, well below earlier claims. Canada and Mexico remain in the crosshairs, with a 25 percent tariff potentially being imposed on February 1. Earnings have gotten off to a solid start, with 80 percent of S&P 500 companies reporting earnings above estimates, exceeding the five-year average of 77 percent.

Fixed Income

Index	Month-to-Date	Year-to-Date	12-Month
U.S. Broad Market	0.28%	0.09%	2.98%
U.S. Treasury	0.25%	0.06%	2.24%
U.S. Mortgages	0.35%	–0.01%	3.17%
Municipal Bond	0.30%	–0.05%	2.21%

Source: Bloomberg, as of January 24, 2025

Treasury yields were relatively unchanged, with an incremental increase in rates in the belly of the curve. The 2-year and 30-year were flat, whereas the 5-year and 10-year increased just 1 basis point each.

The Takeaway

International markets fared well on a softer U.S. dollar and better-than-feared tariff policy.
Bonds were little changed.

Looking Ahead

It should be a busy week for markets. Economic data will primarily focus on consumer confidence, the Federal Open Market Committee (FOMC) rate decision, U.S. economic growth, and personal income and spending.

On Tuesday, the Conference Board Consumer Confidence Index for January will be released. Confidence is expected to improve modestly.
The FOMC will release its January rate decision on Wednesday. The Federal Reserve (Fed) is expected to keep short-term interest rates unchanged.
On Thursday, the advance estimate of fourth-quarter GDP will be released and is set to show that the pace of economic growth slowed. Personal consumption growth is also expected to slow modestly.
Finally, on Friday, personal income and personal spending data for December will be released. Both are set to rise, which would cap a strong year of income and spending growth.

Mark Gallagher is a financial advisor located at Gallagher Financial Services at 2586 East 7th Ave. Suite #304, North Saint Paul, MN 55109. He offers securities and advisory services as an Investment Adviser Representative of Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. He can be reached at 651-774-8759 or at mark@markgallagher.com

Authored by the Investment Research team at Commonwealth Financial Network.

Market Update for the Week of January 6, 2025

Posted on January 6, 2025 by Neal Gallagher

Presented by Mark Gallagher

Manufacturer confidence improved more than expected in December. Equity markets remained risk-averse to start the year amid questions on policy and inflation. This week, we will see the December meeting minutes from the Federal Open Market Committee (FOMC), along with data on employment and consumer sentiment.

Quick Hits

Report releases: Manufacturer confidence improved more than expected last month.
Financial market data: Equity markets remained risk-averse to start the year amid questions on policy and inflation.
Looking ahead: This week, we expect December’s FOMC meeting minutes, along with data on employment and consumer sentiment.

Keep reading for an in-depth look.

Report Releases—December 30, 2024–January 3, 2025

Pending Home Sales: November (Monday)
Pending home sales beat estimates in November, marking five consecutive months with increasing sales growth. The Northeast was the lone region to decline.

-Expected/prior month pending home sales monthly change: +0.7%/+1.8%

-Actual pending home sales monthly change: +2.2%

Construction Spending: November (Thursday)
Construction spending was in line with the revised October figure of $2,152.3 billion.

-Expected/prior month construction spending monthly change: +0.3%/+0.4%

-Actual construction spending monthly change: +0.0%

Institute for Supply Management (ISM) Manufacturing Index: December (Friday)
Manufacturer confidence improved more than expected, driven in part by a rise in new orders.

-Expected/prior ISM Manufacturing index: 48.2/48.4

-Actual ISM Manufacturing index: 49.3

Auto Sales: December (Friday)
Auto sales reached their highest level since May 2021, totaling 16.8 million on an annualized basis.

The Takeaway

-We saw mostly positive data across multiple industries during the holiday-shortened week.

-Construction spending, which remained flat in November, is worth watching.

Financial Market Data

Equity

Index	Week-to-Date	Month-to-Date	Year-to-Date	12-Month
S&P 500	–0.45%	1.05%	1.05%	28.04%
Nasdaq Composite	–0.49%	1.62%	1.62%	35.46%
DJIA	–0.59%	0.46%	0.46%	16.31%
MSCI EAFE	–0.87%	–0.30%	–0.30%	6.37%
MSCI Emerging Markets	–0.81%	–0.13%	–0.13%	10.04%
Russell 2000	1.13%	1.72%	1.72%	17.37%

Source: Bloomberg, as of January 3, 2025

Global markets started the year lower, except for U.S. small-cap stocks. International markets, facing a strong U.S. dollar and soft economic data in China and Europe, remained under pressure. Two major stories were a 4.9 percent drop in Tesla’s fourth-quarter deliveries and news that Apple would offer a discount in the Chinese market. Energy, utilities, and real estate were the top performing sectors, whereas materials, discretionary, and staples underperformed.

Fixed Income

Index	Month-to-Date	Year-to-Date	12-Month
U.S. Broad Market	–1.62%	–0.13%	1.56%
U.S. Treasury	–1.48%	–0.11%	0.72%
U.S. Mortgages	–1.64%	–0.18%	1.52%
Municipal Bond	–1.43%	0.29%	1.39%

Source: Bloomberg, as of January 3, 2025

In a week of relatively low volume trading, the Treasury yield curve continued to steepen slightly. The longer end of the curve remained mostly unchanged, with the 30-year planted at 4.81 percent. The 2-year fell 5 basis points (bps) to 4.28 percent and the 10-year dipped 2 bps to 4.6 percent.

The Takeaway

-Equity markets remained risk-averse to start the year amid questions on policy and inflation.

-The yield curve continued to steepen after the Federal Reserve (Fed) indicated it would keep rates elevated in 2025.

Looking Ahead

This week, we will see the December meeting minutes from the FOMC, along with data on employment and consumer sentiment.

-Tuesday kicks things off with the release of the ISM Services index for December. Service sector confidence is set to improve after falling more than expected in November.

-On Wednesday, minutes from the FOMC’s December meeting will be released. Economists and investors will analyze them for hints on the path of monetary policy.

-Finally, on Friday, we’ll see the employment report for December and the preliminary University of Michigan consumer sentiment survey for January. The job report is expected to show that a solid 153,000 jobs were added, which would be a sign of continued healthy labor demand.

Authored by the Investment Research team at Commonwealth Financial Network.