Breakfast News: Jittery Market Awaits Jobs
March 7, 2025
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Thursday's Markets |
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| S&P 500 5,739 (-1.78%) |
| Nasdaq 18,069 (-2.61%) |
| Dow 42,579 (-0.99%) |
| Bitcoin $89,242 (-0.85%) |
Source: Image created by JesterAI.
1. Payrolls in Focus
The market is already on edge, and on track for the roughest week since September 2024, due to trade war fears and economic data showing slowing U.S. consumer spending. If Friday's jobs report contains any negative surprises expect it to compound existing jitters.
- Positive consensus estimates: The unemployment rate in February is expected to match the January figure of 4%, the lowest level since last May. The headline Non-Farm Payrolls print is forecast to rise modestly from 143,000 to 160,000. Economists noted that federal job cuts are expected to impact later reports.
- "A good jobs print helps, but it's probably not enough to sort things out." Stuart Kaiser, head of U.S. equity trading strategy at Citi (C -0.91%), feels investors need to keep an eye on things.
2. Crypto Reserve Gets Green Light
The signing of an executive order to create a U.S. strategic Bitcoin (BTC -3.85%) reserve was followed by a fall in the coin of almost 6% before it stabilized. The lack of any immediate purchase of crypto by the order left some investors underwhelmed.
- "Not cost taxpayers a dime": President Trump's crypto czar, David Sacks, explained that although the reserve won't be buying new assets, it'll include Bitcoin and other coins seized from law enforcement actions.
- A pot of over 198,000 Bitcoins worth around $17 billion: Other digital assets, including Ethereum (ETH -5.10%), that are the proceeds of crime will be included in the reserve. Yet the current trend lower in the crypto market remains correlated to stocks, guided by concerns around tariff trade wars and inflationary pressures.
3. Analyst Downgrade Hits Tesla
Tesla (TSLA -3.78%) fell by 5.6%, following another analyst downgrade and concerns around Elon Musk's foray into government. The stock has now almost erased all of the post-election gains.
- "Sentiment on the brand potentially souring": Just days after analysts at Bank of America (BAC -0.44%) cut their price target, Baird revised their forecast as well. The team flagged a risk of missing quarterly deliveries alongside uncertainty about Musk's involvement in the administration.
- Up 461% over the past five years: Analysts' targets still reflect gains from the latest closing price of $263. The business has consistently found ways to innovate over time, with long-term investors looking ahead to robotics and autonomous vehicles.
4. Costco's Cautious Customers
Costco (COST -0.69%) reported a mixed bag of results after the closing bell. E-commerce sales drove overall growth, but thrifty shoppers caused earnings to miss expectations.
- 78.4 million paid memberships: A 6.8% growth in the number of memberships, with a U.S. and Canada renewal rate of 93%, impressed investors, especially following the September membership price increase.
- "The impact of some return of inflation and the potential impact of tariffs": CFO Gary Millerchip noted that the business is aware of risks going forward, with consumers likely to be choosier this year. 2025 has planned expansions in international markets, setting a target of 29 new warehouse openings.
5. Foolish Fun
The nine largest companies listed in the U.S. have market capitalizations above $900 billion. Which will be the next to join that cohort: Eli Lilly, Walmart, JPMorgan Chase, Visa, or another company? Debate with friends and family or become a member to hear what your fellow Fools are saying.
