Weekly Market Insights | Tariffs Take Markets for a Wild Ride

Stocks continued their slide through a volatile week. U.S. trade policy drove much of the market’s movement, broadening investors' concerns about economic growth and inflation.

The Standard & Poor’s 500 Index declined 3.10 percent closing at 5,770.20, while the Nasdaq Composite Index dropped 3.45 percent closing at 18,196.22. The Dow Jones Industrial Average slid 2.37 percent closing at 42,507.60. By contrast, the MSCI EAFE Index, which tracks developed overseas stock markets, rallied 2.85 percent.^1,2

Tariffs Take Effect

Big price swings and tariff uncertainty loomed over the entire week. Stocks opened lower out of the gate after the White House confirmed the planned 25 percent tariff on Mexican and Canadian goods would go forward. Soft manufacturing and construction data also put broad downward pressure on markets. Meanwhile, European stocks continued to rally on anticipated defense spending.³

Stocks fell further as tariffs affected Canada, Mexico, and China. Each country announced retaliatory tariffs of their own, further fanning inflationary fears among investors. By Tuesday's close, all three averages were down 3 percent on the week, and the S&P had given up its post-election gains.⁴

Markets rebounded midweek after the White House announced a one-month reprieve from tariffs for North American automakers complying with the existing United States-Mexico-Canada Agreement (USMCA). The recovery rally built momentum as the administration hinted that exemptions for other sectors could follow.⁵

However, as trade policy fatigue rose again, the rebound reversed—despite the White House pausing more tariffs on Canadian and Mexican imports until April 2. Comments from the Treasury secretary defending U.S. tariffs and downbeat economic reports put further pressure on share prices. The Nasdaq entered correction territory, and for the first time in five years, the S&P 500 hit its sixth consecutive day of +/-1 percent price swings.⁶

Stocks continued to fall after an underwhelming February jobs report. Later, markets rebounded after Federal Reserve Chair Jerome Powell said that the economy “continues to be in a good place” and that the Fed was holding firm on current rates. The S&P, Dow, and Nasdaq all finished Friday in the green despite being down for the week.⁷

The February employment report showed nonfarm payrolls rose by 151,000, which was smaller than the increase of 160,000 jobs expected in a survey compiled by Bloomberg. The unemployment rate rose to 4.1% in February from 4% in January. No change had been expected.All but one sector of the S&P 500 fell this week. Financials had the largest percentage drop, sliding 5.9%, followed by a 5.4% decline in consumer discretionary, a 3.8% loss in energy and a 3.4% decrease in technology.

KKR (KKR) was hit hardest in the financial sector, falling 15%. The company priced 45 million shares or $2.25 billion worth of its 6.25% Series D mandatory convertible preferred stock at $50.00 per share.

Among consumer discretionary stocks, shares of Best Buy (BBY) fell 12% as Chief Executive Corie Barry warned of price rises due to tariffs imposed by President Donald Trump. Best Buy also issued a full-year earnings outlook that fell short of Wall Street estimates at the midpoint.

The energy sector's drop came as crude oil futures also fell on the week. Diamondback Energy (FANG) was among the decliners, losing 12% as the company said it priced a debt offering to raise $1.2 billion.

In technology, Hewlett Packard Enterprise (HPE) shares shed 20% as the company issued fiscal Q2 profit guidance that trailed analysts' projections, citing industry-wide "uncertainty" from the current US tariff policy. Hewlett Packard Enterprise also shared plans to achieve roughly $350 million in run-rate cost savings by fiscal 2027 through job cuts. It plans to reduce its workforce by 5%, or about 2,500 employees, over the next 12 to 18 months.

Health care was the lone sector in positive territory for the week, edging up 0.2%.Moderna (MRNA) was the sector's best performer, with its shares jumping 15% as a German court ruled that Pfizer (PFE) and its partner BioNTech (BNTX) infringed a COVID-19 vaccine patent owned by Moderna, according to a Reuters report. The court ordered Pfizer and BioNTech to disclose earnings related to the patent's use and pay a compensation to Moderna, according to the report.

Next week, earnings reports are expected from companies including Oracle (ORCL) and Adobe (ADBE).Economic data will feature the February consumer price index and producer price index, two closely watched inflation readings.

Under the Hood

The Institute for Supply Management (ISM) published fresh manufacturing data on Monday. Although headline numbers were decent, a closer look revealed that new orders dropped in January from a years-long high into correction territory while deliveries and prices paid jumped.⁸  Compaines were pulling forward orders due to anticipated tarriffs so it's expected. 

This Week: Key Economic Data

Tuesday:  Job Openings. NFIB Small Business Optimism Index.

Wednesday:  Consumer Price Index (CPI). Federal Budget. Treasury Announcement.

Thursday:  Producer Price Index (PPI). Initial Jobless Claims.

Friday:  Consumer Sentiment.

^{Source: Investors Business Daily - Econoday economic calendar; March 7, 2025
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.}

This Week: Companies Reporting Earnings

Monday:  Oracle Corporation (ORCL)

Wednesday:  Adobe Inc. (ADBE)

^{Source: Zacks, March 7, 2025. Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.}

“Surround yourself with people only who are going to take you higher."

– Oprah Winfrey

Are Medical and Dental Expenses Tax-Deductible?

If you file your taxes using itemized deductions, you may be able to deduct medical and dental expenses for yourself, your spouse, and your dependents. According to the IRS, you may deduct only the total medical expenses exceeding 7.5% of your adjusted gross income.

Some types of medical care expenses that may be deductible include:

• Payments for the diagnosis, cure, treatment, and prevention of a disease
• Payments to doctors, dentists, surgeons, chiropractors, psychiatrists, psychologists, and nontraditional medical practitioners
• Paying for inpatient hospital care or nursing home care
• Fees associated with inpatient treatment for alcohol or drug addiction
• Payments to participate in a weight-loss program for a specific disease diagnosed by a doctor (such as obesity)

This information is not a substitute for individualized tax advice. Please discuss your specific tax issues with a qualified tax professional. 

Tip adapted from IRS⁹

Perfect Your Pigeon Pose

If you sit a lot at work or have tight hips, the pigeon pose (a popular pose in yoga) might help. It’s a simple pose that anyone can do, even if you don’t have experience practicing yoga. Here’s how to do it:

• First, start on all fours with your hands shoulder-width apart and your knees hip-width apart.
• Next, bring your right knee close to your right wrist and get your shin parallel to the mat's top.
• Then, bring your left leg back behind you and rest on the mat with your thigh, knee, and shin touching it.

Some find sitting in this pose with their chest upright enough. To increase the intensity of the pose, they lean forward, rest their forearms on the mat, and rest their heads on their hands.

Tip adapted from Healthline¹⁰

What binds two people together yet touches only one person at a time?

Last week’s riddle: Lidia immediately went bankrupt after the car she was pushing around stopped in front of a hotel. It sounds sad, but she wasn’t upset. What was she doing?
Answer: She was playing Monopoly.

Lady Franklin Fjord Polar Bear  
Nordaustlandet, Svalbard, Norway

Footnotes and Sources

^{1. The Wall Street Journal, March 7, 2025}

^{2. Investing.com, March 7, 2025}

^{3. The Wall Street Journal, March 3, 2025}

^{4. CNBC.com, March 4, 2025}

^{5. CNBC.com, March 5, 2025}

^{6. CNBC.com, March 6, 2025}

^{7. MarketWatch.com, March 7, 2025}

^{8. The Wall Street Journal, March 4, 2025}

^{9. IRS.gov, September 26, 2024}

^{10. Healthline, October 3, 2024}

^{11. YCharts.com / Provided by MT Newswires Mar. 3 - 7, 2025}