Market Overview

The S&P 500 edged higher on Friday, avoiding a fifth consecutive week of losses driven by trade policy turmoil, recession concerns, and weakness in megacap technology shares. The index added 0.08%, while the Nasdaq Composite gained 0.5%, and the Dow Jones Industrial Average rose 32 points, or 0.08%. At its lowest point, the S&P 500 was in the red for the week before rebounding.

Friday’s session was marked by heightened volatility due to a “quadruple witching” event, where stock options, index futures, index options, and single-stock futures expired. Goldman Sachs estimated that over $4.7 trillion in notional options exposure expired. Market movement was further influenced by President Donald Trump’s comments on tariffs, where he suggested some “flexibility” but reaffirmed that tariffs implemented at the April 2 deadline would be reciprocal.

The S&P 500 remains about 8% below its record high, narrowly avoiding correction territory, while the Nasdaq 100 is experiencing its longest weekly slide since 2022. Wall Street continues to grapple with concerns over an economic slowdown, tariff impacts, and uncertainties in the technology sector. Investors remain cautious, with systematic funds turning net short on U.S. stocks for the first time in over a year. Trend-following CTAs have reduced their S&P 500 exposure to its lowest level since 2023, while individual investors injected over $12 billion into equities in the week ending March 19.

Despite trade policy uncertainty, Bank of America analysts note that investor sentiment remains skeptical about tariffs leading to a recession. Analysts at 22V Research suggest that while concerns over reciprocal tariffs are rising, final tariff figures could be lower than expected, which may help stabilize markets in the long run.

Corporate News

• FedEx Corp. shares fell 6% after the company cut its earnings outlook, citing “weakness and uncertainty in the U.S. industrial economy.”
• Nike Inc. declined about 5% as the company warned that this quarter’s sales would miss analyst expectations due to tariffs and waning consumer confidence.
• Micron Technology Inc. and Lennar Corp. also reported weaker-than-expected forecasts, adding to market caution.
• Boeing Co. saw a positive boost after securing a contract to build the U.S.’s next-generation fighter jet.

A volatile stretch in 2025 is likely to persist until at least the second half of the year, with equity prices remaining below recent highs, according to Morgan Stanley’s Michael Wilson. He projects that new market highs are unlikely in the first half of the year, indicating a “rolling recovery” instead of a sharp rebound.