Weekly market news: 3 March 2025

 

Investors are bracing for a packed week of economic data and corporate earnings that could set the tone for markets in March. The key event? Federal Reserve (Fed) Chair Jerome Powell’s upcoming speech on 7 March, where it’s expected that he’ll outline the central bank’s stance on interest rates amid persistent inflation concerns.

Markets are still weighing the odds of a rate cut this summer, but last week’s hotter-than-expected inflation data threw a wrench into expectations. With US consumer prices rising at an annual rate of 3%, up from 2.9% in January, Powell’s comments will be scrutinised for any shift in the Fed’s timeline.

Meanwhile, equity markets remain fixated on the AI boom, with Broadcom and Marvell Technology set to report earnings. Investors will be watching for clues on AI-driven semiconductor demand following NVIDIA’s blockbuster results last week. Both companies supply key components for AI data centers, and any signs of slowing momentum could ripple across the sector.

On the geopolitical front, China’s annual National People’s Congress (NPC) kicks off on 5 March, where policymakers will unveil economic growth targets and stimulus measures. With the Chinese economy struggling to rebound, markets are eager for signs of stronger policy support to revive demand.

 

Coming up this week

• Monday: US ISM manufacturing index (February).
• Tuesday: Eurozone inflation (preliminary, February).
• Wednesday: US services PMI (February), China trade balance (February).
  • Earnings: Marvell Technology
• Thursday: US jobless claims.
  • Earnings: Broadcom Inc, Costco
• Friday: US non-farm payrolls (February), Jerome Powell’s speech, China imports and exports data.

 

What you might’ve missed last week

Global: Oil prices spiked as OPEC signaled potential supply cuts to counter weaker global demand. Meanwhile, China’s latest manufacturing data showed continued contraction, raising concerns over its economic recovery.

US: The S&P 500 closed on a high after NVIDIA’s earnings smashed expectations, reinforcing optimism in AI-led growth. However, strong economic data fueled fresh doubts about the Fed’s rate-cut path.

Europe: The European Central Bank signaled it remains cautious about cutting rates, with inflation still above its 2% target. Meanwhile, UK retail sales unexpectedly rebounded in February, driven by strong consumer spending on discretionary goods.

 

Why it matters

With inflation proving stickier than expected, investors are recalibrating their bets on when the Fed might ease policy. Powell’s testimony this week will be crucial in shaping rate expectations, with markets now pricing in fewer cuts than previously thought.

China’s economic trajectory remains a wildcard. The NPC meeting could set the stage for new stimulus measures, but if Beijing’s response underwhelms, it may deepen concerns about slowing global growth.

Meanwhile, the AI-fueled market rally continues, but tech investors will be watching closely for any signs of overheating. NVIDIA’s earnings may have solidified its dominance, but the broader sector’s sustainability is still up for debate.

The bottom line? Markets are walking a tightrope between inflation risks, policy uncertainty, and tech-fueled optimism. Investors should stay nimble as they navigate another volatile week.

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