empty
04.03.2025 09:29 AM
Will the U.S. Stock Market Continue to Decline? (Potential Drop in #SPX and #NDX)

The U.S. economy is losing growth momentum, which raises concerns for investors in American financial assets amid uncertainty due to a trade war initiated by Donald Trump against U.S. trading partners.

Data from the Institute for Supply Management (ISM) on Monday showed that the Manufacturing PMI fell to 50.3 in the past month from 50.9 in January, below the expected 50.5. The index indicates slower growth in the manufacturing sector due to declining demand, production stabilization, and job cuts. Companies show signs of an initial operational shock from the new administration's tariff policies. Rising prices due to Trump's trade policies have already caused delays in placing new orders, disruptions in supplier deliveries, and an impact on production resources.

New orders have dropped significantly since March 2022, falling to 48.6 from 55.1. Employment has also declined to 47.6 from 50.3, nearing the contraction threshold of 50. The report also points to a sharp slowdown in production, dropping to 50.7 from 52.5 in the previous month. Additionally, price pressures have surged to their highest level since June 2022, rising to 62.4 from 54.9. A similar trend is observed in other manufacturing inventory indicators.

With Canada and Mexico expected to join the trade war against the U.S. today, a 25% tariff on imports from these countries is anticipated. Coupled with signs of a slowing national economy, the U.S. stock market continues its freefall after a brief rebound late last week. This is further exacerbated by China's decision to impose retaliatory tariffs of up to 15% on certain U.S. goods starting March 10. The release of pessimistic economic data, concerns over import tariffs, and geopolitical tensions between Washington and Ukraine have already impacted U.S. stock indices, which fell between 1.5% and 2.5% on Monday.

Crude oil prices for BRENT and WTI remain in a short-term downtrend, experiencing their steepest decline since mid-January. A key factor in this drop was the announcement that OPEC+ will continue its planned production increase in April. This raised fears of rising global supply, which will likely put downward pressure on oil prices. Additionally, the prospect of new U.S. tariffs on imports from Canada and Mexico could slow economic growth and reduce oil demand.

The cryptocurrency market experienced a brief rebound over the weekend, sparked by statements from Trump on Truth Social. He claimed that a U.S. crypto reserve would "elevate this critical industry" and reverse the restrictive policies of the previous administration. However, the market crashed on Monday and continues to decline this morning, erasing all previous gains.

Looking at the broader picture, it is clear that Trump's administration is dismantling the geopolitical and economic frameworks established by the Democrats. However, it has yet to produce any tangible positive results—something that would be challenging to achieve in just a month and a half of his presidency.

This image is no longer relevant

This image is no longer relevant

Market Forecast for the Day

#SPX

The S&P 500 CFD contract remains under pressure but is still within the 5807.00–6124.80 range. If the decision to impose higher tariffs on Canadian and Mexican goods is confirmed today, and if Trump signals that this is only the beginning, we could see a breakdown of the lower boundary of this range, leading to a drop to 5700.00.

#NDX

The NASDAQ 100 CFD contract is also under pressure, trading near its support level of 20,500. The technology sector feels the strain from China's retaliatory tariffs, which could significantly impact U.S. tech companies. A further deterioration in the situation could push the contract down to 19,863.00.

Pati Gani,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

A New Problem Rises for America – The Debt Ceiling (Expecting #SPX and #NDX to Resume Their Decline After a Likely Short-Term Recovery)

The confrontation between the U.S. and the EU has entered a new phase. The U.S. president is taking a hardline approach toward Europe, effectively following a "tit for tat" strategy

Pati Gani 14:06 2025-03-14 UTC+2

USD/JPY: Analysis and Forecast

The Japanese yen is losing ground today. Positive news on U.S.-Canada trade negotiations and reports that Democrats have secured enough votes to prevent a U.S. government shutdown are improving global

Irina Yanina 13:33 2025-03-14 UTC+2

XAU/USD: Analysis and Forecast

Gold is consolidating after reaching a new all-time high. Concerns over U.S. President Donald Trump's aggressive trade policy and its impact on the global economy continue to drive demand

Irina Yanina 10:08 2025-03-14 UTC+2

What to Pay Attention to on March 14? A Breakdown of Fundamental Events for Beginners

There are few macroeconomic events scheduled for Friday, and none of them are significant. The UK will release reports on GDP and industrial production, but strong figures are not expected

Paolo Greco 07:05 2025-03-14 UTC+2

GBP/USD Pair Overview – March 14: The Last Day of the Week as a Mere Formality

On Thursday, the GBP/USD currency pair also began a slight downward correction. While the pound did not depreciate significantly, explaining why it rose for two weeks is difficult. Of course

Paolo Greco 02:39 2025-03-14 UTC+2

EUR/USD Pair Overview – March 14: Maybe That's Enough?

The EUR/USD currency pair finally began to decline on Thursday, but once again, this movement was not linked to macroeconomic factors or fundamental events. It wasn't even related to Donald

Paolo Greco 02:39 2025-03-14 UTC+2

EUR/USD: A Southern Impulse That Should Not Be Trusted

On Thursday, the EUR/USD pair reached a three-day low of 1.0823 but did not break into the 1.07 range, as the downward momentum gradually faded. The EUR/USD pair is currently

Irina Manzenko 23:55 2025-03-13 UTC+2

Euro Faces a Potential Coup d'Etat

The Green Party responded to Friedrich Merz's call for a coalition between the CDU and the Social Democrats, aimed at abolishing the fiscal brake, with a strong rebuttal: "We don't

Marek Petkovich 23:45 2025-03-13 UTC+2

U.S. Inflation Brings Relief to the Fed but Not to the Markets

The euro and pound showed little reaction to news that consumer prices in the U.S. grew at their slowest pace in four months in February—a welcome sign for American households

Jakub Novak 11:14 2025-03-13 UTC+2

Euro Faces Some Challenges

The European currency has encountered some difficulties in its upward movement following yesterday's speech by the European Central Bank (ECB) President. "The eurozone economy is facing exceptional shocks caused

Jakub Novak 10:39 2025-03-13 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.