Stocks To Watch – 2/18/2025

 Brief Overview

Welcome back to this week’s Stocks to Watch! We hope you are enjoying the the day off from the market in honor of Presidents’ Day! We’ve been excited to get back to the action with earnings still in full swing. 

Let’s take a look at last week.

President Trump announced a 25% tariff on all steel and aluminum imports, starting March 12. No exemptions this time. The goal? Boost domestic production. The concern? Higher costs for industries that rely on these materials and potential trade blowback. Investors weren’t sure how to react, keeping markets relatively flat.

Fed Chair Jerome Powell took center stage for his semi-annual policy testimony before Congress. The labor market is still strong, with unemployment at 4.0% and wages growing 4.1%, but inflation is sticking around. Powell hinted that interest rates might stay higher for longer to keep inflation in check. Translation? Don’t expect rate cuts anytime soon.

January’s inflation report showed a small uptick, thanks to recent tariffs and a cold snap that pushed up energy prices. Analysts think inflation could stay above the Fed’s 2% target throughout 2025, meaning more economic uncertainty ahead.

Markets saw some wild swings as investors tried to price in the impact of new tariffs. The S&P 500 flirted with record highs but pulled back as uncertainty over trade policies made some traders hesitant. The big question: Will other countries hit the U.S. with their own tariffs in response?

The week wrapped up with a mixed bag. Nvidia’s stock rallied, lifting the Nasdaq, but Microsoft dipped slightly. Meanwhile, Treasury yields fell after Trump floated the idea of more “reciprocal” tariffs but didn’t lay out any new details. Investors are watching closely to see if more trade restrictions are coming.

It was a big week for policy moves, with new steel and aluminum tariffs, inflation creeping up, and the Fed signaling that rate cuts aren’t happening anytime soon. Markets are still finding their footing, and with talk of even more tariffs on the horizon, expect more volatility as we move deeper into February. Buckle up!