The last week was dramatic for investors, maybe a little too dramatic.
Stocks were buffeted by worries about a slowing economy, the uncertainty caused by the Trump Administration’s hyper-aggressive moves to chop the federal payroll, and finally the wild, bitter meeting between Ukraine President Volodymyr Zelensky, President Trump and others.
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Then, the stock market astonished probably everyone by rebounding in the last two hours or so of trading.
Alas, the end doesn’t exactly cheer, The Standard & Poor’ 500 Index dropped 1% on the week. The Nasdaq Composite fell 3.5%, and the Nasdaq-100 Index was off 3.4%. The Dow Jones Industrial Average actually rose nearly 1% for the week but dipped 1.6% for the week.
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A lot of smart people on Wall Street fretted that the start to 2025 would be . . . Let’s use the word “choppy,” and they’re right so far.
The transition from Joe Biden to Donald Trump has been messy, volatile and will likely be so for the next four years. And the economy seems to be slowing down.
The S&P 500 closed at a record 6,144 on Feb. 19 and is down 3% since. The Nasdaq has fallen 6.6% since mid-December.
Want some good news? How about 30-year mortgage rates falling? Freddie Mac and Mortgage News Daily both see rates approaching 6.75%, with the trend line sloping downward.
That brings matters to the financial markets as March opens. Markets will be affected two big forces:
- A busy week or earnings that will be dominated by some sizable technology stocks and a slew of retail stocks.
- The economy and the big jobs report due Friday.
The key stocks to watch are Broadcom (AVGO) and Costco Wholesale (COST) .
Broadcom makes stuff for the technology world
Earnings: Due after Thursday’s close. Market capitalization: $943.8 billion as of Feb. 28. Stock price: $199.43, up 0.8% on Friday. Down 14% in 2025 after rising 107.7% in 2024. and up 14.7% since the Nov. 5 election. Earnings estimate: $1.51 a share for the first quarter, up 37% from a year ago. Revenue estimate: $14.6 billion, up 22%.
Its top products includes semiconductors and equipment that makes today’s technology work.
It was spun out of Hewlett-Packard in the 1960s and has built itself by buying businesses it wants and can manage well, spinning what it doesn’t and morphing into different entities. In 2019, it tried to take over Qualcomm (QCOM) , but the effort failed in part because of opposition from the first Trump Administration.
Since then, Broadcom has succeeded at finding ways to add business from the artificial intelligence buildout. Its market cap topped $1 trillion for the first time in mid-December.
The Wall Street Journal reported in mid-February that Broadcom has been studying buying the chip-design and marketing businesses of struggling chip giant Intel (INTC) but would sell off Intel’s chip manufacturing business. No firm offer has been made, and Intel’s stock price is up 18.4% since bottoming in September.
(Taiwan Semiconductor (TSM) may be looking at buying Intel’s factory business, The Journal also said.)
What the company has to say about Intel and the slowdown that seems to be afflicting tech companies is important. Broadcom shares are down 20% since peaking in December.
Related: Big new threat slams Tesla’s stock price
Can Costco keep the momentum going?
Earnings: Due after Thursday’s close. Market capitalization: $465.5 billion as of Feb. 28. Stock price: $1,048.61, up 2.6% on Friday. Up 14.4% in 2025 after rising 38.8% in 2024. and up 17.8% since the Nov. 5 election. Earnings estimate: $1.51 a share for the first quarter, up 37% from a year ago. Revenue estimate: $14.6 billion, up 22%.
Costco has emerged as the world’s third-largest retailer ranked by market capitalization. Ahead of the Issaquah, Wa.-based company are only Amazon.com (AMZN) ($2.25 trillion) and Walmart (WMT) ($792.2 billion).
The business is solid; sales have risen an average 8.7% a year since 2005. The company operates 890 stores world-wide. It charges an annual membership fee to get in. In exchange, it keeps prices on a relatively limited number of products and services down but delivers quality. Customers seem satisfied. They renew their memberships at a 90%-plus clip. An increase in the fee hasn’t hurt business — so far.
There are two issues that investors will want to know more about.
Are customers showing any signs of worry about the economy? Retailers pretty much have been noting that customers are more careful in their spending this year. Costco did have a strong holiday season, and its online business has been surging. But it also has acknowledged more consumer frugality.
Is the company worried that its stock could be vulnerable to a slump? The shares are solidly above its 50-day moving average and has been for years. The stock so far this year has outperformed Walmart (14.4% to 9.1%).
A busy week in total
At least 400 companies of various sizes will be reporting quarterly results this coming week. Retail companies will be a focal point of the reports.
FactSet reported this week that the concerns about tariffs and inflation have caused analysts to trim the earnings per share estimates more than normal. Normal is about a 2.6% estimate cut as a quarter progresses. Now it’s up to 3.5%. The biggest cuts are in estimates for materials companies. Estimates for financial companies are rising.
More Economic Analysis:
- Retail sales tumble in January, testing Fed rate cut forecast
- CPI inflation shock hammers Fed rate cut bets for 2025
- Rate cuts and tariffs will weigh on economic reports
Among companies reporting this week are:
Technology
- Cybersecurity company Crowdstrike Holdings (CRWD) , after Tuesday’s close. Earnings estimate: 86 cents, down 9.5%
- Chipmaker Marvell Technology (MRVL) after Wednesday’s close. Earnings estimate: 59 cents a share, up 28.3%.
- Cloud-security company Zscaler (ZS) , after Wednesday’s close. Earnings estimate: 69 cents, down 9.2%.
- Data-storage company MongoDB (MDB) . After Wednesday’s close. Earnings estimate : 66 cents, down 23%.
Retailing
- Discount retailer Target (TGT) , before Tuesday’s open. Earnings estimate: $2.65, down 11%.
- Apparel retailer Ross Stores (ROST) , after Tuesday’s close. Earnings estimate $1.67, down 8.2%.
- Appliance, computer and video retailer BestBuy (BBY) . Before the open. Earnings estimate: $2.42, down 11%.
- Apparel retailer Nordstrom (JWN) . After the close. Earnings estimate 90 cents, down 6.3%. Note: Members of the Nordstrom family are working a bid to take the company private in a $6.3 billion deal expected to close later this year.
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