*Performance since 7/1/2022. For more details on the performance calculation and methodology of Alpha Picks, click here. |
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► Investor confidence took a notable hit this week, particularly in speculative assets like crypto, prompting a shift to defensive sectors. The Nasdaq was down -5.07%, the S&P 500 -2.49%, and the Dow Jones -0.27%.
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► Falling bond yields and anticipated rate cuts could stimulate growth and support risk assets despite current volatility and uncertainty; the 10-year yield fell by over 2 basis points to 4.26% on Friday.
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► Corporate earnings highlighted Nvidia's strong performance. Despite a slowdown in data center growth, the company reported Q4 revenues of $39.3B (up 78.8% YoY). Its Blackwell GPU segment maintained solid sales at $11B.
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► Bitcoin tumbled more than 25%, below $80K, amid crypto ETF outflows. The Crypto Fear & Greed Index fell to 10, highlighting heightened market distress.
| ► Geopolitical factors intensified as President Trump confirmed new tariff measures—25% on Canadian/Mexican imports and an additional 10% on Chinese goods—leading to a flight to defensive assets and resulting in a firming USD index coupled with declines in the loonie and peso.
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Alpha Picks is a rigorous, data-driven model that offers Strong Buy-rated stocks believed to have the highest probability of capital appreciation based on a proprietary quantitative model. Two 'Strong Buy'-rated stocks are selected monthly on the first trading day of the month and the 15th or the closest trading day thereafter. |
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Global Market Movements and Sector Performance |
'Boring is Back': Defensive Sectors Shine |
'Boring is back,' according to Jay Woods, Chief Global Strategist at Freedom Capital Markets. As the market gravitated toward defensive stocks amidst the volatility, a shift to a defensive posture is underscored by the recent outperformance of the Consumer Staples (XLP) and Utilities sectors (XLU) over the last month. Read More. |
Geopolitical tensions have come to the forefront with the implementation of new tariff measures. President Trump imposed a 25% tariff on $1.2T of Canadian and Mexican imports and a 10% tariff on $550B of Chinese goods. Read More. |
This week, defensive sectors continued to outperform amid tariff concerns. However, the Real Estate sector (XLRE) emerged as the top performer following mortgage rates sliding to their lowest level in two months. The 30-year fixed rate averaged 6.76% as of February 27, down from 6.94% one year ago. Read More. |
Value Stocks vs. Growth Stocks
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Value stocks outperformed growth equities, benefitting from a flight to safety amid geopolitical tensions. Despite the energy sector being the "top detractors" for companies reliant on U.S. revenue exposure in Q4, companies like Exxon Mobil (XOM) and Chevron (CVX), offering dividend safety, experienced gains throughout the week, which bolstered the performance of value stocks. Read More. |
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The digital asset market experienced a pronounced downturn, with Bitcoin (BTC-USD) sliding over 25%, below $80,000 this week amid substantial ETF outflows. Secondary cryptocurrencies such as ETH-USD and SOL-USD were hit even harder, declining 31% and 42%, respectively, as investor enthusiasm for meme coins evaporated. Read More. |
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The Japanese yen weakened this week as the U.S. dollar gained strength. The Japanese yen depreciated by 1.1%, despite ongoing speculation about a potential interest rate hike by the Bank of Japan. Read More. |
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Rising economic woes amid weakening U.S. consumer confidence are pushing financial markets to anticipate more easing from the Federal Reserve this year. Fed Funds Futures now show 2.3 rate cuts priced in for 2025, the most since December. |
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► FOMC: The current rate range has held steady at 4.25%-4.50%, with markets now pricing in approximately 58bps for Fed rate cuts in 2025 starting in July.
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► Inflation: Tariff-driven inflation remains a concern following January's CPI increase of 3% YoY, despite tenant rent data indicating shelter inflation could ease to approximately 2.5% by Q3.
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► Labor Market: The upcoming March 7 jobs report is expected to reveal an increase of approximately 165K payrolls, following last week's rise in initial claims to 219K.
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| CrowdStrike Holdings, Inc. (CRWD) AutoZone, Inc. (AZO) |
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| Marvell Technology, Inc. (MRVL) Veeva Systems Inc. (VEEV) |
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| Broadcom Inc. (AVGO) Costco Wholesale Corporation (COST) |
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*Performance is as of February 28, 2025. Alpha Picks adds two stocks per month—on the closest business day to the 1st & 15th. Alpha Picks removes stocks based on rating thresholds (i.e., when a rating changes to a sell). Performance is calculated and reported daily using time-weighted returns. For more details on the performance calculation and methodology of Alpha Picks, click here.
Past performance is no guarantee of future results. Alpha Picks does not take account of your objectives or your financial situation and does not offer any personalized investment advice. Any content and tools on the platform are offered for information purposes only. Any views or opinions expressed may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker, U.S. investment adviser, or investment bank. |
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