Stock Market Rallies Despite Magnificent Seven Weakness
The stock market bounced back on Monday, with the S&P 500, Dow Jones, and Nasdaq all gaining. The S&P 500 rose 0.6%, while the Dow Jones climbed over 350 points. The Nasdaq lagged behind, rising just 0.3% as the Magnificent Seven stocks struggled. Tesla and Nvidia both ended in the red, dragging down tech-heavy indexes.
Retail investors played a key role in this rally. They poured billions into the market, hoping for a rebound after a tough correction. Despite the positive momentum, concerns remain over Trump’s tariff policies and Federal Reserve decisions on interest rates.
Stock Market Investors Brace for Fed Decision
All eyes are on the Federal Reserve as it begins a two-day meeting. Investors expect the Fed to hold interest rates steady but are looking for signs of future cuts. With weak economic data and recent volatility, many believe the Fed may need to act sooner than expected.
Retail sales data released Monday showed slower-than-expected growth. Sales ROSE just 0.2% in February, well below the expected 0.6% increase. This slowdown is fueling speculation that rate cuts might come later this year to support economic growth. Meanwhile, the New York Fed’s business conditions index took a sharp dive, reinforcing fears of an economic slo
wdown.
Dow Jones Recovers from Worst Week Since 2023
After suffering its worst weekly performance since 2023, the Dow Jones managed a strong rebound. Nearly all S&P 500 sectors traded in the green, led by energy and real estate stocks. The market correction had wiped out billions in value, but investors seem to be stepping back in, looking for opportunities.
However, the recovery isn’t uniform. The Magnificent Seven stocks, including Tesla, Amazon, and Google, struggled to keep pace. Tesla’s stock fell over 5% after it announced a free self-driving trial in China, raising concerns about demand in one of its key markets.
Stock Market Faces Uncertainty Amid Tariff and Inflation Fears
Investors are navigating a market full of uncertainty. Trump’s unpredictable tariff policies are keeping traders on edge, as they could impact supply chains and corporate profits. Meanwhile, inflation concerns linger, adding pressure on the Federal Reserve to carefully balance rate decisions.
Adding to the turbulence, Nvidia stock slid 1.8% on Monday ahead of its GTC conference, where CEO Jensen Huang is set to unveil the Blackwell Ultra AI chip. This drop followed an 8% rally last week, as the company rebounded from a post-earnings slump that had dragged the Magnificent Seven lower. Despite production challenges with its previous Blackwell AI servers, Nvidia is scaling up its new products, with Huang emphasizing that the next transition will be smoother. The company expects Blackwell Ultra to launch in the second half of the year, a move closely watched by investors.
Wall Street firms are adjusting their forecasts. RBC Capital Markets cut its year-end target for the S&P 500 from 6,600 to 6,200, citing economic concerns. While the market’s current rebound is encouraging, analysts warn that more volatility is ahead.
Can the Stock Market Sustain Its Recovery?
The big question now is whether this rally will last. Some strategists see the S&P 500 finding support around 5,400, but others warn of more declines before a real bottom forms. A lot depends on the Fed’s policy direction, corporate earnings, and global economic conditions.
For now, investors are cautiously optimistic. While Tesla and other Magnificent Seven stocks may continue to struggle, a broader market recovery could be in play. If retail traders keep buying and the Fed signals rate cuts, the stock market could regain its footing in the months ahead.
