March 5th Market Overview

Happy Wednesday.

I think everyone’s happy to see today’s green. I changed up the format to allow live prices on tickers mentioned. However, I think it makes the newsletter uglier and I grab prices between 3:30 - 4:00pm market time everyday anyway.

Idk what does everyone think of the new tickers? Should I keep them or go back to the non embedded live tickers? Doing a survey vote.

Let's dig in...

Executive Summary

• Markets staged a robust recovery rally today as the White House granted a one-month tariff exemption for automakers complying with USMCA, sparking hopes for additional concessions.
  

• Private sector job creation slowed dramatically in February with just 77,000 jobs added, well below the expected 148,000, raising economic slowdown concerns.
  

• Technology and Materials sectors led today’s gains, while Energy continued to struggle amid ongoing concerns about global demand.
  

• The VIX dropped below 22 for the first time in seven sessions but remains elevated, reflecting lingering uncertainty about trade policy.
  

Market Overview

1. Tariff Relief for Automakers: White House announced a one-month delay on tariffs for USMCA-compliant automakers. Commerce Secretary indicated Trump may walk back some tariffs on Canada and Mexico.
   

2. Weak Employment Data: ADP reported just 77,000 private jobs added in February, far below the 148,000 expected, raising economic concerns.
   

3. ISM Services Strength: ISM services index posted 53.5 in February, up from January, with prices index rising to 62.6, indicating inflation pressures.
   

4. Rising Trade Tensions: Uncertainty persisted as Trump told Canadian PM that fentanyl efforts were "not good enough." Fed's Beige Book mentioned "tariffs" 45 times.
   

Stock Spotlight

• $HII ( ▼ 0.9% ) : Soared after Trump pledged to revive military shipbuilding.

• $STLA ( ▼ 0.11% ) : Surged following the automaker tariff exemption, with $GM ( ▼ 1.33% ) climbing and $F ( ▼ 2.68% ) adding

• $NVO ( ▼ 2.38% ) : Jumped after launching direct-to-consumer online pharmacy for Wegovy at reduced prices.

• $CRWD ( ▲ 3.73% ) : Fell after hours despite strong Q4 results due to weak guidance and 20% YoY Net New ARR decline.

Big Name Updates

• $AAPL ( ▼ 0.19% ) : App Store revenue reached $5.3B in fiscal Q2, up 14% YoY.

• $TSLA ( ▲ 0.7% ) : Goldman Sachs lowered price target to $320 from $345, citing weaker delivery trends.

• $DIS ( ▲ 0.41% ) : Cutting 6% of ABC & entertainment TV staff—about 200 jobs.

• $QCOM ( ▼ 0.42% ) : CEO claims X85 modem outperforms Apple’s first in-house C1 modem.

Other Notable Company News

• The Trump administration plans to give Bitcoin “unique status” in U.S. crypto reserve, with a crypto summit Friday.

• $ASML ( ▲ 1.53% ) cited macroeconomic uncertainty and export controls for customer capex cuts.

• $LMT ( ▼ 1.21% ) : US Navy dropped Lockheed from 7th generation F/A XX fighter competition.

Sector Watch

Bond Market

The 10-year Treasury yield climbed 6.8 basis points to 4.278% as investors moved away from safe-haven assets amid the equity rebound. This move maintains the ongoing tension between inflation concerns and potential economic impacts from trade policy changes.

Policy Watch

• China set its growth target at about 5% for 2025 with a fiscal deficit goal around 4% of GDP—the highest level in more than three decades.
  

• German political leaders agreed to amend the constitution to exempt defense and security outlays from fiscal spending limits and set up a €500 billion infrastructure fund.
  

• Trump reportedly received a letter from Ukrainian President Zelenskiy indicating Ukraine is ready to negotiate to end Russia’s war and sign a minerals deal.
  

• Reports emerged that the U.S. cut off intelligence sharing with Ukraine, though Ukrainian officials disputed this claim.
  

• Ed Yardeni of Yardeni Research raised recession probability to 35% from 25%, citing investor uncertainty from Trump’s “head-spinning barrage of executive orders, firings, and tariffs.”

What to Watch

1. NFP Jobs Report on Friday: Following today’s disappointing ADP report, markets will closely monitor Friday’s official jobs data for confirmation of labor market weakness.

   • Watch for whether the headline number shows similar weakness to the ADP data

   • Pay attention to the unemployment rate for signs of softening

   • Wage growth data will be critical for inflation implications
     

2. Tariff Negotiations Development: Commerce Secretary Lutnick mentioned that Canada and Mexico announcements could come as early as today.

   • Monitor for additional exemptions beyond the auto sector

   • Watch market reaction in sectors with high exposure to cross-border trade

   • Consider impacts on consumer prices and inflation expectations
     

3. Crypto Summit on Friday: The administration’s approach to cryptocurrency regulation could significantly impact digital asset valuations.

   • Bitcoin’s “unique status” announcement may drive further institutional adoption

   • Regulatory frameworks for other cryptocurrencies will shape the competitive landscape

   • Watch for potential tax implications for crypto investors

P.S. 
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Thanks for reading 🙂

- John