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Stocks Climb as Easing Tariff Worries Spark Risk-On in Asset Markets

Stocks Climb as Easing Tariff Worries Spark Risk-On in Asset Markets

  • 24.03.2025 15:32
  • theglobeandmail.com
  • Keywords: High, Low

Stocks rise as tariff worries ease; S&P 500, Dow Jones, and Nasdaq climb on news of targeted tariffs, boosted by M&A activity.

SMCI Services

Estimated market influence

Aerovate Therapeutics Inc

Positivesentiment_satisfied
Analyst rating: N/A

The company is expected to release strong earnings results which could positively impact its stock price.

AMMO Inc

Negativesentiment_dissatisfied
Analyst rating: N/A

The company may face challenges in meeting earnings expectations, potentially leading to a decline in stock value.

Context

Business Insights and Market Implications

Stock Market Performance

  • S&P 500 Index: Up +1.58%
  • Dow Jones Industrials Index: Up +1.23%
  • Nasdaq 100 Index: Up +1.96%
  • June E-mini S&P futures: Up +1.62%
  • June E-mini Nasdaq futures: Up +1.95%

Key Drivers of Market Movement

  • Easing Tariff Worries: Stocks rallied on reports that US tariffs will be more targeted, with some countries exempt and existing tariffs not cumulative.
  • Geopolitical Risks: Heightened tensions in the Middle East (Israel-Gaza, Yemen) weigh negatively on markets.

Economic Indicators

  • US Feb Chicago Fed national activity index: Rose +0.26 to 0.18 (vs expectation of -0.17).
  • US Mar S&P Global manufacturing PMI: Fell -2.9 to 49.8 (vs expectation of 51.7).
  • US Mar S&P Global services PMI: Rose +3.3 to 54.3 (vs expectation of no change at 51.0).

Upcoming Reports

  • Feb new home sales: Expected +3.5% m/m to 680,000.
  • Mar consumer confidence index: Expected -4.7 to 93.6.
  • Q4 GDP: Expected unrevised at +2.3% (q/q annualized).

Interest Rates and Bond Markets

  • 10-year T-note yield: Up +7.3 bp to 4.319%.
  • 10-year German bund yield: Up +2.1 bp to 2.786%.
  • 10-year UK gilt yield: Down -0.1 bp at 4.712%.

M&A Activity

  • James Hardie Industries收购Azek Co: $8.75 billion in cash and stock.
  • Clearlake Capital Group收购Dun & Bradstreet Holdings: ~$4.1 billion.

Cryptocurrency and Chip Stocks

  • Bitcoin: Up +4% to a 2-week high, driving gains in Coinbase Global, MicroStrategy, MARA Holdings, and Riot Platforms (+4%).
  • Chip stocks: Advanced Micro Devices, ARM Holdings Plc, ON Semiconductor, Microchip Technology, NXP Semiconductors NV, Analog Devices, KLA Corp, Lam Research, Texas Instruments all up +3% to +5%.

Defensive Stocks Under Pressure

  • Food and beverage producers: Hormel Foods, Ball Corp, Kraft Heinz, Brown-Forman down -1%+.

Earnings Reports (March 24, 2025)

  • Aerovate Therapeutics Inc (AVTE), AMMO Inc (POWW), Enerpac Tool Group Corp (EPAC), Intuitive Machines Inc (LUNR), KB Home (KBH).

Analyst Upgrades/Downgrades

  • Coherent Corp: Raymond James upgraded to strong buy with $91 price target.
  • Pinterest: Guggenheim upgraded to buy with $40 price target.
  • Viasat Inc., FedEx, Boeing: All upgraded with positive price targets.
  • Super Micro Computer: Goldman Sachs downgraded to sell with $32 price target.

Market Sentiment

  • Market discounting rate cuts: 16% chance of -25 bp FOMC rate cut in May.
  • ECB rate cut chances: 65% for a -25 bp cut at April 17 meeting.