U.S. Stocks Fall on Tariffs, Inflation and Growth Concerns

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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 28, U.S. stocks declined, largely driven by weakness in the information technology and communication services sectors, while value stocks outperformed growth shares for the sixth consecutive week. Trump’s announcement on Wednesday of a 25% levy on all non-U.S.-made automobiles—as well as concerns around a broader economic slowdown and weakening consumer sentiment weighed on stocks later in the week, sending major indexes into negative territory. Refer to below major indexes performance table for the week.

Key highlights for the week and next:

1.    25% auto tariffs announced by Trump. The tariffs take effect April 3 and target fully assembled vehicles, but will expand to include auto parts by May 3. The announcement weighed on shares of automakers and parts suppliers, as well as the stock markets of countries with large auto exposure such as Germany and South Korea. (The auto sector represents 7% of the German DAX vs. 2% of the S&P 500.) 

Given that about half of the 16 million cars sold last year in the U.S. were imported, the sector will experience a disruption. And there could potentially be knock-on effects, such as higher prices for used cars, repairs and insurance. Consistent with this line of thinking, rental car stocks jumped last week on the view that tariffs will bolster the value of their fleets as these companies eventually sell their used vehicles. 

2.    Reciprocal and other sector-specific tariffs. The auto tariffs were unveiled ahead of a broader announcement of reciprocal tariffs set to take effect on April 2, aiming to raise levies to match those of other countries. The tariffs would apply on a country-by-country basis and may include other non-tariff barriers such as value-added taxes (VATs) into the calculation. Separately, the administration has suggested that additional product-specific tariffs, including lumber and pharma, would be coming soon. 

3.    Inflation concern. Core personal consumption expenditures (PCE) price index—the Fed’s preferred measure of inflation—rose 0.4% in February, up from January’s reading of 0.3%. On a year-over-year basis, the core PCE rose 2.8%, remaining well above the Fed’s long-term inflation target of 2%. 

4.    Consumer expectations hit a 12-year low. The Conference Board reported that its consumer confidence index declined for the fourth consecutive month in March to 92.9, down from February’s reading of 100.1. The expectations portion of the index dropped 9.6 points to 65.2, reaching its lowest level in 12 years and remaining below 80, which could indicate a recession ahead, for the second consecutive month. 

SPX sectors in play

Consumer Staples(XLP) was the only one out of the 11 SPX sectors recorded weekly gain. The weakness led by Tech(XLK) and Communication Services(XLC), XLK declined 3.54% this week, and was down 11.24% YTD. Refer to below SPX sectors ETF weekly performance table.

Indexes technical levels

All three major indexes headed down again after one week pause. All below their respective 200dma- often indicate as last defence line for bulls. It’s weak technically, it’s remain to be seen whether they will continue drop lower than recent lows, the Nasdaq Composite(COMP) was just 40 points above its recent low. Click below three indexes for their weekly charts.

DJI weekly chart

SPX weekly chart

Nasdaq weekly chart

China/HK

China stock markets ended the week little change amid a light economic calendar and corporate earnings that generally met expectations. The Shanghai Composite Index(SSE) shed 0.4% while the blue chip CSI 300 edged up 0.01%. In Hong Kong, the benchmark Hang Seng Index declined 1.11%. (refer to the above weekly performance table).

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

1.    Profits at industrial firms shrank 0.3% in the first two months of the year over the year-ago period, China’s statistics bureau reported. The contraction fell short of economists’ forecasts for an increase in industrial profits and underscored the urgency for China to bolster domestic demand amid the threat of higher U.S. tariffs. Last week, a former vice chair of China’s state economic planner said that China should seek to raise consumption to 70% of gross domestic product (GDP) by 2035 from about 55% currently. Consumption in China should increase between 5% and 8% as a share of GDP over the next five years, the official told participants at the Boao Forum, an annual global investor gathering in China, Bloomberg reported. 

2.    Boosting consumption is the Chinese government’s top economic priority for 2025 as Beijing seeks to counter rising geopolitical tensions and diminishing returns on investment at home. China recently set an annual economic growth target of about 5% for the third straight year, an ambitious goal that analysts believe will require significant stimulus.

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) added 1.17% to close at 3972.43 for the week, record its 2^nd weekly gains in a row, the index appears very resilient when market sentiment is weak around the major global markets. STI hits new high on Thursday to 4005.18, also its first time in record to hit 4000 level.

 Top weekly gainers include ST engineering, The company benefited from increased defence budgets across several European countries, aligning with its strong position in the defence and engineering sectors. Banks including DBS and OCBC were also among top gainers. 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.