Market Focus: Trump’s Trade War, U.S. Jobs Report, and Q4 Earnings
As the new week unfolds, investors are turning their attention to key events that will shape market sentiment. From Trump’s trade war to the latest U.S. jobs report and the last batch of Q4 earnings, there is much to watch out for. Here are the highlights for the week ahead:
1. U.S. Stock Performance Recap
- U.S. stocks closed higher on Friday, wrapping up a volatile week and a losing month for the major averages.
- The S&P 500 declined roughly 1% for the week and 1.4% in February.
- The Nasdaq lost about 4% in February, its worst monthly decline since April 2024.
- The Dow Jones managed to outperform, rising about 1% during the week, but dropped 1.6% month-to-date.
Source: Investing.com
2. Trump’s Tariffs and Economic Data
President Donald Trump’s aggressive tariffs against Canada, Mexico, and China will be in focus this week. Investors will also be watching Friday’s U.S. employment report for February, expected to show the economy added 156,000 positions with the unemployment rate holding steady at 4.0%. Additionally, there will be a heavy slate of Fed speakers, including Chairman Jerome Powell.
Source: Investing.com
3. Noteworthy Earnings Reports
While the earnings season is winding down, some noteworthy reports are still due, including companies like Broadcom, CrowdStrike, Costco, Target, Best Buy, Macy’s, Kroger, and JD.com.
Stocks to Watch:
Stock to Buy: Costco
Costco, the Issaquah, Washington-based warehouse retailer, is expected to deliver its fiscal second-quarter earnings this week. Here’s why it’s a stock to watch:
- Traders are pricing in a potential 4.4% swing in COST stock following the earnings report.
- Recent profit estimates revisions show optimism, suggesting Costco may beat expectations.
- Analysts project earnings to increase by 4.1% year-over-year, driven by strong revenue growth.
- Costco’s disciplined business model and robust membership program make it resilient in uncertain times.
- COST stock has been performing well, with shares up 14.4% year-to-date.
Stock to Sell: Foot Locker
Foot Locker, the New York-based sportswear retailer, is facing challenges ahead of its Q4 financial results. Here’s why it’s a stock to avoid:
- The options market points to a possible 16.2% swing in FL shares following the earnings report.
- Analyst sentiment is bearish, with no upward revisions in recent weeks.
- Foot Locker is expected to report a decline in revenue, reflecting challenges in the retail environment.
- The company’s stock is trading at a 52-week low, down 20.4% year-to-date.
- Foot Locker currently has a ‘WEAK’ Financial Health score, indicating operational challenges.
Analysis:
In conclusion, this week presents a mix of opportunities and risks for investors. Costco’s strong performance and potential growth make it a stock worth considering, while Foot Locker’s struggles reflect the challenges faced by some retailers in the current economic environment. By staying informed and making strategic investment decisions, investors can navigate the market volatility and position themselves for success in the long run. Subscribe now to InvestingPro for actionable trade ideas and stay ahead of the curve! Title: Uncover the Secrets to Building Wealth Through Strategic Investments
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