U.S. Stocks Continue Volatile Due to Tariff and Recession Worries

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Main Content:

1.    Major indexes weekly performance 

2.    U.S stocks weekly wrap 

3.    S&P 500 sector index weekly/month performance 

4.    China/Hong Kong stocks weekly wrap 

5.    Singapore stocks weekly wrap 

6.    Major indexes weekly chart and technical support & resistance levels

U.S.

For the week of Mar 14, U.S. stock indexes posted losses, with the S&P 500 Index(SPX), Nasdaq Composite(COMP), and Russell 2000 Index(RUT) all notching a fourth consecutive week of negative returns, while the Dow Jones Industrial Average(DJI) slid 3.07%, putting all four indexes into negative territory for the year. Ongoing uncertainty surrounding trade policy seemed to drive much of the negative sentiment as new tariff announcements from the Trump administration continued throughout the week. Growth concerns and increasing recession fears—which were amplified by comments from Donald Trump regarding a “period of transition” for the U.S. economy—also weighed on sentiment during the week.

The SPX briefly dipping into correction territory, down 10.5% from its recent highs. The COMP has dropped about 14% from peak-to-trough this year. This was the first 10%+ drawdown in the SPX since October 2023, nearly 1.5 years ago. Refer to below major indexes performance table for the week.

Key highlights for the week and next:

1.    Despite the sharp pullback in U.S. stock markets, there have been areas of financial markets that have performed better – and are even up for the year: 1) Within U.S. equities, value and cyclical sectors have outperformed tech and AI stocks. 2) Bonds have outperformed stocks broadly this year thus far as investors looked for safety. 3)And many international stock markets, including Europe and China, have been up 8%-10%. 

2.    Inflation eases in February. Latest CPI data indicated that consumer prices rose 0.2% MoM in February, while core CPI saw its lowest YoY increase since Apr 2021, rising 3.1% over the prior 12 months. February’s readings for both monthly and annual inflation slowed from January, and both were slightly below consensus expectations. 

3.    FOMC next week. Thursday’s producer price index (PPI) data painted a similar picture for February, with headline prices unchanged from January and core prices declining for the first time since July compared with expectations for a 0.3% increase for both readings. Fed policymakers are widely expected to hold interest rates steady following their upcoming meeting on March 18–19. 

4.    Weak consumer confidence. The University of Michigan reported its Index of Consumer Sentiment for March on Friday morning, which declined 11% month over month to 57.9. The index has now declined three months in a row and is down 22% from December 2024. 

SPX sectors in play

Only two out of the 11 SPX sectors recorded weekly gain. Defensive and cyclical sectors such as Utilities(XLU) and Energy(XLE) outperform technology(XLK) and growth sectors such as Consumer Discretionary(XLY) thus far. It’s expected the health care( XLV) and financials(XLF) sectors could continue to perform well in the year ahead, particularly if the administration focuses on deregulation and tax policy in the coming months. Refer to below SPX sectors ETF weekly performance table.

SPX sectors year-to-date return

Indexes technical levels

Both SPX and COMP indexes have recorded four weeks losing streak in a row. The S&P 50(SPX) is now down 4.13% for the year and SPX briefly down to correction territory (-10.5% from recent high) before it bounced on Friday, resulted -8.5% from recent high. While the technology-heavy Nasdaq(COMP) is down about 14% this week, into correction territory. Click below three indexes for their weekly charts.

DJI weekly chart

SPX weekly chart

Nasdaq weekly chart

China/HK

China stock markets rose on stimulus hopes after Beijing said it would hold a press conference on Monday with policymakers focusing on boosting consumption. The Shanghai Composite Index(SSE) gained 1.39% while the blue chip CSI 300 added 1.59%. In Hong Kong, the benchmark Hang Seng Index was down 1.12%. (refer to the above weekly performance table).

Key highlights for the week and outlook for China/HK:

1.    Officials from China’s finance ministry, commerce ministry, central bank, and financial markets watchdog are expected to appear at Monday’s briefing, which “will introduce the situation of boosting consumption,” according to the announcement from the State Council. News of the conference sparked a rally in Chinese shares on Friday, pushing the CSI 300 Index to its highest level since mid-December. 

2.    Increasing consumption to drive economic growth has become more important for China’s policymakers since the onset of the U.S.-sparked trade war. At the just-concluded National People’s Congress meeting, China set an ambitious economic growth target of about 5% for the third straight year and stated that boosting consumption is the government’s top priority for 2025. 

3.    Weak domestic consumption was underscored in China’s latest inflation report. The consumer price index fell a greater-than-expected 0.7% in February from a year ago, according to the statistics bureau, marking the first contraction since January 2024. The core CPI—which excludes food and energy costs—declined 0.1% year on year, its first decrease since 2021 and only the second time the gauge contracted in more than 15 years, according to Bloomberg. Meanwhile, the producer price index, which tracks wholesale prices, fell 2.2% in February, its 29th straight monthly contraction. 

4.    Stamping out deflation is a matter of growing urgency for Beijing, which rolled out a slew of monetary and fiscal stimulus measures last September to spur demand. But a yearslong housing slump has prompted people to save rather than spend, frustrating officials’ attempts to bolster consumption.

Refer to below .HSI stocks top 40 performance of the week.

Click below SSE and .HSI indexes for their weekly charts. 

SSE weekly chart

.HSI weekly chart

Singapore

The Straits Times Index (STI) declined 2.0% to close at 3836.02 for the week -its five weeks low. The three local banks led the decline. Immediate technical support at 3805 and upside resistance at 3851 level.

This week’s top index gainer was JMH with 9.01% up, REITs were also among the top gainers as chances of U.S cutting more rates growing, which will benefit REITs. Sembcorp Ind was the top weekly loser, down 5.4%.

Refer to below STI stocks weekly performance table.

Click below for STI weekly chart.

STI weekly chart

Source: Some contents and data excerpted from various public market reports. Please comment to claim copyright ownership of any material, and I will remove it if necessary.