The stock market on Wedensday demonstrated mixed results following February's inflation data, with technology stocks outperforming industrial sectors, according to financial analyst and a famous X perssona Amit Kukreja from @amitisinvesting.
Amit reports the S&P 500 rose 0.50% and the Nasdaq Composite gained 1.13%, while the Dow Jones Industrial Average declined 0.20%. The Consumer Price Index came in at 2.8%, slightly below the expected 2.9%, with core CPI at 3.1%, also lower than anticipated.
"Shelter costs rose 0.3%, accounting for nearly half of the monthly CPI increase," Amit noted in his market recap. His analysis highlighted that "US egg prices surged 10.4% in February, with a notable 58.8% year-over-year increase," though "the cost for a dozen eggs has reduced by about $2 in the past week from an all time high at $8.25."
According to Amit, investors adjusted their expectations for interest rate cuts, with "probabilities for a rate cut at the FOMC meeting on March 19th is now 2% while probabilities for the May cut reduced from 40% to 27%."
In the technology sector, Amit reported that "Google unveiled Gemini Robotics, an AI model based on Gemini 2.0, designed to bring multimodal reasoning and embodied intelligence to robotics." He detailed that the company is "partnering with Apptronik, a humanoid robot startup, to develop advanced humanoid robots like Apollo."
Palantir announced "its sixth AIPCon, set for tomorrow," which will feature "new customer announcements, including Heineken, Walgreens, R1 RCM, RaceTrac, Ripcord, and others," according to Amit's analysis.
Amit also noted that "Goldman Sachs reduced its 2025 S&P 500 target to 6,200 from 6,500, citing weaker earnings, higher tariffs, and tighter conditions." The investment bank "lowered S&P 500 EPS to $262 from $268 and the valuation multiple to 20.6x from 21.5x."
Tesla's stock performance showed significant volatility, with Amit reporting the stock "hit a low of $215 on Monday and reversed over the past 2 days, up 10% today closing at $253." He observed that "Google Search interest for 'Buy a Tesla' has spiked to a multi-month high recently, with significant increases in Republican-leaning states like Nevada and Florida."
Mortgage rates continued their downward trend with Amit noting that "the average 30-year fixed-rate mortgage rate for conforming loans ($766,550 or less) in the US dropped to 6.67% for the week ending March 7, 2025, the lowest since early October."
The broader economic picture shows concerning trends, with Amit highlighting that "the US budget deficit ballooned to a record $1.15 trillion through the first five months of the fiscal year, while credit card debt surged to an all-time high of $1.21 trillion."
