TheDrop Market Analysis, 03/18/25
Stocks tumbled on Monday in reaction to general sentiments showing a poor outlook of the economy.
The S&P 500 fell 1.1%, the Dow fell 0.6%, and the Nasdaq fell 1.7%. The Russell, which usually underperforms the remainder of the market, fell by a smaller margin than its bigger index fund peers, dropping 0.9%. However, gold did strengthen and the price of crude oil fell to low levels in reaction to shifting supply and demand.
Investors sold off in record numbers today in reaction to Nvidia's Keynote address Monday. Although promising additional AI technologies in a new lineup of his prominent Blackwell chip lineup, the conference failed to impress investors to hoped for something much more ambitious or revolutionary. In addition, a key decision by the Federal Reserve is expected to be released soon, with many investors fearing that a rate cut would not be happening. As a result, to save their equity before further reduction, they sold out of the market in droves.
Nvidia led today's general bear market with a 3.4% decline, quite significant for a company as bullish as Nvidia. In fact, although it previously hoped to make a stable recovery in the hopes of bringing its share price above $140 per share, today marked the temporary end of this recovery effort, thus diminishing the likelihood of a successful recovery in the next few months.
However, not only Nvidia made large declines today. Tesla fell an additional 5.3% as investors are pessimistic regarding its operations in China, due to signs showing that the company is failing to its much cheaper, domestic Chinese EV producers. Stocks like Apple (0.6%) and Microsoft (1.3%) also fell by massive margins in a chain reaction to Nvidia and Tesla.
On the good side, Intel continued to lead the market in performance with a 0.9% rise, one of the only tickers today to rise. Its recent strong performance shows that there is indeed some hope for the company to realize substantial progress in its mission to adapt to a more Nvidia and Broadcom-centered chipmaking industry. This comes after its new CEO, Lip Bu-Tan, has promised ambitious moves for the company, like splitting its domestic and foreign operations into separate entities, perhaps subsidiaries.
