Stock Market Update Friday February 14, 2025
Stock Market Update Friday February 14, 2025 Today, stock market performance was mixed. The S&P 500 (SPX) remained unchanged, the Nasdaq-100 (QQQ) increased by 0.4%, and the Russell 2000 (IWM) fell by 0.2%. However, the overall market had a strong week, with the S&P 500 rising about 1.5% and nearing record highs, despite concerns over higher-than-expected inflation, increasing tariff issues, and disappointing retail sales.
Away From Stocks: Treasuries experienced a bull-steepening trend, with the 2-year yield decreasing by five basis points to 4.26%, and the 30-year yield falling three basis points to 4.69%. This shift indicates that investors are seeking longer-duration securities in anticipation of upcoming economic events next week. In the commodities market, WTI crude oil dropped below $71 per barrel due to concerns about global demand and rising inventory levels. Gold prices also fell to $2,884 per ounce as inflation expectations shifted and real yields changed. Bitcoin remained steady near $97,000, supported by institutional investments and increased adoption of ETFs. The VIX index closed below 15, indicating low volatility in the equity markets as investors prepare for a week filled with important data releases.
Next week, several important events could lead to market volatility. On Wednesday, the release of the FOMC minutes will give us a clearer understanding of the Federal Reserve’s policies and any changes in its inflation outlook. Investors will be keenly observing for indications about future interest rate movements and whether the Fed intends to adopt a more dovish approach later this year.
From February 26-28, markets will analyze the S&P Global PMIs, which will provide updated insights into economic activity and business confidence in key sectors. The PCE report, which is the Fed’s preferred measure of inflation, will also be significant, especially following this week’s unexpectedly high CPI. Any surprises in core PCE inflation could affect expectations for rate cuts and lead to fluctuations in the bond market.
Additionally, Nvidia’s earnings report will be a key focus, given its significant impact on the AI sector and overall market sentiment. The company's guidance and outlook for data center growth could greatly influence momentum in the tech sector and affect movements in Nasdaq-heavy ETFs like QQQ.
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Following a 10-week trading range from mid-December to now, and three significant downward gaps in the last three weeks, the recent upward movement seems to be backed by both fundamental factors and market sentiment. Here are some key reasons for this: