Desla's Weekly Market Update: February 3, 2025

Desla's Weekly Market Update: February 3, 2025

 

Market Resilience in Shifting Conditions

 

Market Performance

As January came to a close, U.S. markets displayed tenacity despite mid-week volatility, though markets closed lower on Friday as stocks pulled back in the final hours following the White House’s announcement of potential tariffs on Canada, China, and Mexico.

 

• S&P 500: Posted a slight decline, influenced by mixed earnings reports. However, IBM’s strong performance and ongoing strength in consumer spending helped offset some of the negative reports.
• Dow Jones: Recorded modest gains, supported by positive economic reports and continued strength in consumer spending and discretionary sectors.
• NASDAQ: Faced early-week declines but saw a strong rebound, driven by key tech stocks.  However, the index closed with a subtle decrease.

 

Economic Overview

The broader economic picture remained stable, and key indicators aligned closely with expectations.

 

• As inflation remained a key concern, the Federal Reserve’s recent decision to leave interest rates unchanged signals a cautious approach to managing price pressures.
• Wages showed little movement, which helped sustain consumer spending.
• Treasury Yields edged higher as a result of the Federal Reserve’s decision.

 

Sector Highlights

• Technology: The sector experienced some volatility due to concerns surrounding DeepSeek’s AI models early in the week. Additionally, the potential imposition of tariffs on semiconductor imports unsettled investors. However, strong earnings reports from major players like Apple helped drive a recovery towards the end of the week.
• Energy: Oil prices saw gradual growth, supported by ongoing supply constraints and geopolitical factors. This helped the Energy sector gain ground, which contributed to broader market movement.
• Global events: Global markets saw increased uncertainty due to geopolitical tensions and ongoing trade negotiations between the U.S. and key partners, which added to market volatility and could impact growth expectations. 
• Automotive: Tesla finished the week strong, maintaining its role as a key player in the sector.

 

Desla’s Insight

At Desla Wealth Management, we see this week’s market activity as a reminder of the importance of being adaptable in dynamic market conditions. While short-term fluctuations are a natural part of market cycles, our focus remains on the long-term health of your portfolio. Rest assured, we are continuously monitoring the market and are ready to make any necessary adjustments to keep your investments aligned with your goals.

 

As we move forward, we will be transitioning to sharing weekly market updates from a trusted financial source rather than internal updates. We believe this approach offers more comprehensive updates for our clients. We will continue to monitor market conditions and adjust our strategies accordingly as our goal is to help you make well-informed decisions and support your financial success in any market environment.