Mon Feb 24 09:40:00 UTC 2025: **Stock Market Jitters as Economic Data Fuels Growth and Inflation Concerns**

NEW YORK (Yahoo Finance) – Concerns over slowing economic growth and persistent inflation sent shockwaves through the stock market this week, ending a run of record highs. The S&P 500 fell 1.7% for the week, the Nasdaq Composite dropped 2%, and the Dow Jones Industrial Average suffered the most significant losses, plummeting nearly 3%. Walmart’s disappointing outlook further fueled investor anxieties.

The decline comes despite recent record highs. Negative sentiment was amplified by several key economic indicators. The University of Michigan’s consumer sentiment index hit its lowest point since November 2023, while S&P Global’s flash US composite PMI plunged to a 17-month low. Businesses expressed widespread concerns about the impact of government policies, including tariffs and spending cuts. S&P Global Market Intelligence chief economist Chris Williamson noted a significant shift from optimism to pessimism amongst businesses.

Adding to the uncertainty, investors are awaiting crucial economic data releases, including Friday’s core Personal Consumption Expenditures (PCE) index—the Federal Reserve’s preferred inflation gauge. Economists predict a slight moderation in inflation, but it remains above the Fed’s target. This, coupled with a robust labor market, suggests the Fed is unlikely to cut interest rates in the first half of 2025.

Meanwhile, all eyes are on Nvidia’s earnings report, expected Wednesday after the bell. Analysts predict strong growth, but investors are keen to hear CEO Jensen Huang’s assessment of AI chip demand and potential competition from China. The “Magnificent Seven” tech stocks, including Nvidia, have underperformed the S&P 500 this year, contributing less to overall market gains than in previous years.

Despite the recent sell-off, some analysts remain optimistic about the market’s long-term prospects. Citi US equity strategist Scott Chronert anticipates further volatility but believes there’s still upside potential for the S&P 500 before year-end. However, he suggests a period of uncertainty and pullbacks could create better buying opportunities.

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