US stocks traded mixed on Tuesday as investors weighed the latest comments from President Trump on tariffs and looked ahead to key economic reports. The S&P 500 (GSPC) and the Dow Jones Industrial Average (DJI) hovered near the flatline, while the tech-heavy Nasdaq Composite (IXIC) edged 0.2% higher.
Markets rallied on Monday amid speculation that Trump might scale back planned tariffs, but his latest remarks indicated fresh duties on pharmaceuticals and autos are still on the table. Meanwhile, fears of a potential recession linger as investors await consumer confidence data and new home sales figures set for release later today.
Market Movers:
- Tesla (TSLA) -0.14%: Shares fluctuated on Tuesday following a report that its European sales are plunging. Data from the European Automobile Manufacturers’ Association showed a 40.1% decline in Tesla’s vehicle registrations across the EU, UK, and EFTA in February. Despite these concerning figures, RBC analyst Tom Narayan remains bullish on the stock, emphasizing Tesla’s long-term growth potential.
- Meta (META) +2% & Netflix (NFLX) +2%: Meta and Netflix led gains in the Communications Services sector, with Meta rebounding from earlier declines and Netflix extending its year-to-date gains to over 11%. Meta, the only member of the "Magnificent Seven" tech stocks with YTD gains above 7%, has shown resilience despite broader market volatility.
- Carvana (CVNA) +5%: Shares surged after Morgan Stanley upgraded the stock to Overweight with a $280 price target. Analyst Adam Jonas cited the company's strong execution, improving balance sheet, and potential to become the "Amazon of auto retail" as reasons for the bullish call. Carvana shares are now up 10% year to date.
Consumer Confidence Plummets
Despite Monday’s rally, concerns over a possible US recession persist. Consumer confidence data released Tuesday showed a steep drop, with the Conference Board’s index falling to 92.9 in March from 100.1 in February. The expectations index, which tracks consumers' short-term outlook, plunged to its lowest level in 12 years. Analysts warn that continued pessimism could impact consumer spending and broader economic growth in the coming months.
Housing Market Shows Signs of Cooling
January’s home price data revealed that while prices are still climbing, the pace of growth has slowed. The S&P CoreLogic Case-Shiller National Home Price Index rose 4.1% year over year, slightly above December’s 4% gain. However, analysts note that much of the increase occurred in early 2024, with the latter half of the year showing signs of a potential slowdown. This cooling trend could be further impacted by high mortgage rates and declining buyer confidence.
Looking Ahead
Investors will be closely monitoring upcoming earnings reports, with GameStop (GME), Lululemon (LULU), and Dollar Tree (DLTR) set to release results this week. Additionally, Federal Reserve officials continue to signal that interest rates may remain unchanged for an extended period, adding another layer of uncertainty to the market. With tariff concerns, recession fears, and critical economic data on the horizon, market volatility is likely to persist in the near term.