If one word could characterize this week’s stock market price action, it would be “sideways.” At least it’s better than trending lower.
The stock market seemed comfortable with the Federal Reserve’s message on Wednesday, but lost that upside momentum and wasn’t able to follow through on the upside move until the last 30 minutes of Friday’s trading.
The Dow ($INDU), S&P 500 ($SPX), and Nasdaq Composite ($COMPQ) managed to eke out gains, ending the week on a slightly optimistic note.
On the bright side, the Cboe Volatility Index ($VIX) pulled back from its March 10 level. Even quadruple witching Friday—when contracts for stock index futures, stock index options, stock options, and single-stock futures all expire—didn’t see volatility spike too high. That said, the VIX is still elevated, relatively speaking, so we’re not exactly in complacent territory.
Quarterly earnings reports from Nike, Inc. (NKE), FedEx Corp. (FDX), and Micron Technology, Inc. (MU) didn’t help. The most troubling of the three is FDX. FedEx’s performance indicates the overall health of the U.S. economy. Tariffs, declining consumer confidence, and uncertainty about economic growth could be headwinds, for FedEx and other companies.
The weekly chart of FDX below shows the stock is trading below its 150-week exponential moving average (EMA) with its 40-week EMA trending lower. FDX has been underperforming the Industrials Select Sector SPDR (XLI) since early September 2024.
FIGURE 1. WEEKLY CHART OF FEDEX STOCK. FDX is trading below its 150-week EMA and underperforming the Industrial sector. Chart source: StockCharts.com. For educational purposes.
Be sure to save this chart to your ChartLists. It acts like a monitor to check the U.S. economy’s pulse.
Precious Metals Shine
But it’s not all negative. Gold and silver prices have trended higher with gold hitting an all-time high this week. The daily six-month chart of gold futures ($GOLD) below shows that gold prices are trading above $3,000 per ounce.
FIGURE 2. DAILY CHART OF GOLD FUTURES. Gold prices have rallied most of the year and could keep rising if investors invest in safe-haven assets such as gold. Chart source: StockCharts.com. For educational purposes.
In addition to trading above its 50- and 200-day SMAs, gold is outperforming the S&P 500. A rise in gold prices indicates risk-off sentiment, and, if investors continue to sell off stocks, gold prices could rise further. This is another valuable chart to monitor when uncertainty reigns.
Next week is heavy on macro data, so this back-and-forth movement could continue. Fasten your seatbelts.
End-of-Week Wrap-Up
S&P 500 up 0.51% on the week, at 5667.56, Dow Jones Industrial Average up 1.2% on the week at 41,985.35; Nasdaq Composite up 0.17% on the week at 17,784.05.
$VIX down 11.39% on the week, closing at 19.28.
Best performing sector for the week: Energy
Worst performing sector for the week: Utilities
Top 5 Large Cap SCTR stocks: Elbit Systems, Ltd. (ESLT); XPeng, Inc. (XPEV); Palantir Technologies, Inc. (PLTR); Applovin Corp. (APP); Rocket Lab USA, Inc. (RKLB)
On the Radar Next Week
March S&P Global PMI
February PCE
Q4 GDP Growth Rate (final)
Fed speeches from Bostic, Barr, Kugler, and others
Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.