(Bloomberg) — Another volatile week for markets is ending with losses in US stocks as disappointing outlooks from bellwethers across various industries spurred a sense of caution about Corporate America.
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Wall Street is facing extra volatility as an estimated $4.5 trillion of contracts tied to stocks, indexes and exchange-traded funds expire. A rebound in several megacaps drove the S&P 500 away from session lows, but the benchmark got weighed down by underwhelming forecasts from FedEx Corp., Nike Inc., Micron Technology Inc. and Lennar Corp. The Nasdaq 100 headed toward its longest weekly slide since 2022. Boeing Co. jumped on a contract to build the US’s next-generation fighter jet.
“We’re approaching today’s session with a particularly elevated degree of caution,” said Ian Lyngen at BMO Capital Markets.
Trillions of dollars have been shaved from US equity values in the past month as concerns over an economic slowdown, the impact of tariffs, geopolitical risks and questions about lofty tech valuations have unnerved traders. Just a week after the S&P 500 tumbled into a 10% correction, bounces have failed to hold, punishing one of the most time-honored investment strategies: dip buying.
A volatile stretch that’s plagued Wall Street in 2025 is likely to persist until at least the second half of the year, with equity prices remaining below the highs hit last month, according to Morgan Stanley’s Michael Wilson.
“This is going to be a rolling recovery is my best guess,” Wilson said this week in an interview with Bloomberg Television. “We think new highs are probably out of the question in the first half of this year.”
The S&P 500 fell 0.4%. The Nasdaq 100 slid 0.2%. The Dow Jones Industrial Average lost 0.2%. The yield on 10-year Treasuries rose one basis point to 4.25%. The dollar added 0.2%.
Trend-following systematic funds turned net short on US stocks for the first time in more than a year. These commodity trading advisers, or CTAs — which take their cues from the market direction rather than fundamental factors — cut their exposure to the S&P 500 to the lowest level since 2023, data from Goldman Sachs Group Inc.’s trading desk show.
Meantime, individual traders pumped more than $12 billion into US equities in the week ending March 19, data from JPMorgan Chase & Co. showed.
Market watchers keep a close eye on mom-and-pop investors as they are often the last to cut their exposure to stocks, with the latest bout of aggressive buying potentially suggesting that equities haven’t found the bottom yet.
What Spooked the S&P 500? It Wasn’t the Trade War: Nir Kaissar
Investors are dismissing the risks that a full-fledged trade war would pose to stocks as “monster” flows of capital keep pouring into global equity markets, Bank of America Corp.’s Michael Hartnett said.
The fact that inflows into stocks have reached a year-to-date peak and that indexes in Germany and China — two top exporters to the US — have rallied since the election of Donald Trump suggests investors are skeptical that US tariffs will cause a recession.
“The VIX and spreads are back to levels consistent with a non-recessionary, higher uncertainty economic backdrop, helping equity market internals improve,” said 22V Research’s analysts led by Dennis DeBusschere. “That fits with our view that the US economy is NOT moving quickly into a recession.”
While concerns around the April 2 reciprocal tariff announcement are increasing, 22V’s Kim Wallace says actual trade policy risk is less concerning today than it was in December. The headline announcement could be concerning, but Wallace expects the final tariff numbers will be lower.
“Uncertainty will still be high as negotiations take place,” 22V said. “So that is the bad news from a ‘clearing event’ point of view. But the good news (theoretically) is that the direction of travel remains lower on tariffs vs. the headline shocks from the past few months.”
Some of the main moves in markets:
Stocks
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The S&P 500 fell 0.4% as of 3:16 p.m. New York time
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The Nasdaq 100 fell 0.2%
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The Dow Jones Industrial Average fell 0.2%
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The MSCI World Index fell 0.4%
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Bloomberg Magnificent 7 Total Return Index rose 0.5%
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The Russell 2000 Index fell 0.6%
Currencies
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The Bloomberg Dollar Spot Index rose 0.2%
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The euro fell 0.3% to $1.0820
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The British pound fell 0.3% to $1.2925
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The Japanese yen fell 0.3% to 149.23 per dollar
Cryptocurrencies
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Bitcoin fell 0.5% to $84,084.23
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Ether fell 0.5% to $1,969.8
Bonds
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The yield on 10-year Treasuries advanced one basis point to 4.25%
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Germany’s 10-year yield declined two basis points to 2.77%
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Britain’s 10-year yield advanced seven basis points to 4.71%
Commodities
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Sujata Rao and Margaryta Kirakosian.
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