Jamie Spencer
The Dow Jones Industrial Average climbed Wednesday morning after two days of steep losses. Dow stocks gained 0.4% in early trading, while the S&P 500 also moved higher, aiming to break its losing streak.
Stock Market Overview
The S&P 500 rose 0.1%, while the Nasdaq hovered near breakeven levels. Nvidia (NVDA) edged higher following Tuesday’s rebound but remains below its 200-day moving average. Meanwhile, Amazon (AMZN) extended its rally with a 1% increase, finding support at its 200-day line.
Trading volume was lower on both the NYSE and Nasdaq compared to Tuesday, but market breadth was positive, with advancing stocks outpacing decliners by a 2-to-1 ratio.
The small-cap Russell 2000 index gained 0.1%, while growth stocks showed strength. The Innovator IBD 50 ETF (FFTY) led the way, rising 1.2%.
Trump Addresses Congress on Tariffs
President Donald Trump reaffirmed his firm stance on tariffs in a congressional address late Tuesday. However, Commerce Secretary Howard Lutnick suggested that tariffs on Mexico and Canada may be partially rolled back. Trump acknowledged the economic disruptions caused by tariffs but remained committed to his policy.
The yield on the benchmark 10-year Treasury note dipped by one basis point to 4.19%.
Economic Data and Fed Outlook
The ADP employment report for February missed expectations, reporting 77,000 new jobs, far below the consensus estimate of 162,000 and January’s 183,000 gain. Additionally, the February Purchasing Managers’ Index fell to 51.6 from January’s 52.7, though it remained above the forecast of 50.4.
Meanwhile, the Institute of Supply Management Services Index rose to 53.5, beating estimates of 52.7.
Investors are awaiting the Federal Reserve’s Beige Book report, due later Wednesday, which will provide insight into inflation and business activity ahead of the Fed’s March 19 interest rate decision.
Dow Movers: Nvidia, 3M, and Apple
Nvidia edged lower after Tuesday’s 1.7% gain, remaining below its 200-day moving average. The stock also undercut its Jan. 31 low.
Among Dow components, 3M (MMM) and Caterpillar (CAT) led the gains, while Apple (AAPL) and Chevron (CVX) lagged. Apple is forming a cup-with-handle base, signaling potential future gains.
Corporate Earnings Highlights
CrowdStrike (CRWD) beat fourth-quarter estimates with revenue of $1.06 billion and earnings per share of $1.03, surpassing expectations of 86 cents. However, new annual recurring revenue dropped 20%, and its 2026 earnings guidance of $3.39 per share fell short of analyst forecasts of $4.40. Shares triggered three sell signals, falling more than 7% below their recent buy point of 389.
Credo Technology (CRDO) plunged 16% despite reporting 154% revenue growth to $135 million and a 525% increase in earnings per share to 25 cents. However, its outlook of $160 million in fourth-quarter sales exceeded estimates of $146.8 million.
Box (BOX) posted $280 million in revenue for its latest quarter, but earnings remained flat at 42 cents per share. Shares fell below their 50-day moving average, triggering a sell signal.
Retail Earnings: Mixed Performance
Foot Locker (FL) jumped 6%, while Ross Stores (ROST) reversed an early 5% decline to finish higher. Abercrombie & Fitch (ANF), however, plunged 15%. All three stocks remain in a downtrend and are trading below their 50-day moving averages.
China Stocks Rebound
Chinese stocks surged after reports that Beijing set a 5% GDP growth target for 2025. Alibaba (BABA) rose 6%, breaking a four-day losing streak, while JD.com (JD) and Baidu (BIDU) gained more than 3% each. JD.com is forming a cup-with-handle pattern with a buy point of 43.63.
The iShares MSCI China ETF (MCHI) advanced 3.3%.
Market Awaits Further Clarity
As markets attempt to recover from recent losses, investors are closely watching economic data, corporate earnings, and Federal Reserve commentary for further direction. Tariff policy and interest rate expectations remain key market drivers in the weeks ahead.
