Week in Review: 24th to 28th March 2025
During the week of the 24th March 2025, global financial markets experienced a week
of two halves. The FTSE 100 grinded higher early in the week, before losing ground to
offer a narrow weekly gain in a tighter trading range to recent times. The major indices in
the U.S. started the week nicely to build on the previous Friday’s momentum, with a
whiff of positive sentiment setting in. But by Wednesday, more tariff news, political
scandal and further dour economic data put an end to that. Gold’s allure as a safe
haven saw it hit fresh record highs. On the geopolitical front, heated words have been
exchanged between the White House and the Kremlin over the weekend, with new
tariffs and restrictions being weighed up on Russia should ceasefire negotiations drag
on.
Observation of the Week:
President Donald Trump announced a 25% tariff on imported automobiles and
automobile parts. The tariffs targeted passenger vehicles, light trucks, and parts. The
following table overviews the weekly share price movements of major automakers,
highlighting the proportion of cars sold in the U.S. that are produced domestically, and
what the U.S market represents as a proportion of their revenue.
Sources: Tradingview, BofA Global Research, Wards.
Winners – U.S. Domestic Automakers: With a substantial share of their U.S. sales
being locally produced, Ford and GM will face fewer tariff-related cost increases
compared to foreign competitors. GM’s higher U.S. revenue share (82%) suggests it has
limited exposure to potential foreign retaliatory tariffs. Ford’s F-Series pickup truck line,
which is largely built in the U.S., will improve its competitiveness. Tesla and Rivian, both
manufacturing exclusively in the U.S., will be shielded from import tariffs, however
Tesla’s 51% revenue exposure outside the U.S. and reliance on the Chinese market
makes it vulnerable to any foreign retaliatory measures.
Losers – Foreign Players: Porsche will be severely impacted as all US sales (30% of
their revenue) are of imported cars. BMW and Volkswagen rely heavily on imports to
supply the American market. If they cannot shift production to the U.S. quickly, their
vehicles will become significantly more expensive and lose competitiveness. However,
given they’re relatively less reliant on the U.S. for sales, retaliatory tariffs from Europe
may provide them greater protection benefit than the lost sales impact in the United
States. Stellantis has a sizable U.S. production base, but its complex international
structure (headquartered in the Netherlands, with operations in France and Italy) could
expose it to European retaliation. Honda and Toyota are partially insulated but still
vulnerable. While Hyundai has been expanding its U.S. production (including a major EV
facility in Georgia), these shifts take time and will not fully offset tariff impacts in the
short term.
What does it mean for consumers: For those kicking tyres, one thing for certain is
prices will go up on new cars and flow through to prices of used cars. In the U.S., “A 25%
tariff on imported cars could raise the price by $5K to $15K (assuming car values of
$20K to $60K that are subject to tariffs for illustrative purposes, although we
acknowledge some vehicles could fall outside this band),” Goldman Sachs autos
analyst Mark Delaney warned on Friday.
U.K. Market Performance
A slight gain for the FTSE 100 this week in a less volatile week with the index hovering
around the 8650 mark. Year-to-date it is up 485.83 points or 5.94%.
FTSE 100 Movers
Gainers: Next +13%, Beazley +6.9%, Marks & Spencer +6.8%, Compass Group +6%
Losers: Antofagasta -8%, Kingfisher -7.8%, JD Sports -7.1%, Melrose -7%, Entain -6.5%
Notable Macroeconomic Data:
Inflation: UK inflation CPI data unexpectedly fell to 2.8%.
Retail Sales: British retail sales unexpectedly climbed in February as consumers
increased spending on clothing and household goods, offsetting a drop in supermarket
sales, data from the Office for National Statistics showed Friday. Retail sales rose 1% in
the month, easing from January’s revised 1.4% gain but exceeding analysts’
expectations of a 0.3% decline, giving some needed retail therapy to the sector.
Spring Statement: Chancellor Rachel Reeves’ Spring Statement provided little fresh
optimism for investors. Rachel Reeves noted that UK inflation is now expected to
average 3.2% in 2025, up from the 2.6% projected in October, according to the Office for
Budget Responsibility (OBR). Many of the major announcements, such as welfare and
NHS changes, were already well known and had minimal market impact. The biggest
disappointment came from the OBR’s revised UK growth forecast, which was cut from
2% to just 1% for 2025.
Notable Corporate Earnings
• Next – A ‘next’ level performance. Given the doom and gloom in retail of late,
Next stunned markets with a strong set of results and an upgrade for the first half
of fiscal 2026. Next’s rally of over 10% on the day also lifted Marks & Spencer,
which gained 3.8% on Thursday.
• Bellway – Reported a “strong” first half and a 12% rise in interim underlying pre
tax profit.
• Kingfisher – One of the worst performers in London this week after earnings and
revenue missed expectations and tepid guidance caused a sharp fall in the share
price.
• In the FTSE 250, Aston Martin tumbled 7.1%, hit by the tariff news.
U.S. Market Performance
• S&P 500: Down 1.5% for the week after a 2% decline on Friday.
• Dow Jones Industrial Average (DJIA): Down almost 1% for the week after
another 700+ drop on Friday.
• Nasdaq 100: Fell 2.2% on Friday and 2.6% for the week.
• Technicals: The S&P 500 index opened last week back above its 200-day moving
average but could not hold and fell back below this key support level. The 20-day
moving average has also crossed below the 200-day moving average, confirming
a clear down trend in market direction.
Notable Moves
Gainers: Dollar Tree +13.5%, WR Berkley +12.3%. Tesla +12.2%, FedEx +10%
Losers: Super Micro Computer -12.7%, Broadcom -10%, Micron Technology -9.9%, Las
Vegas Sands -9.9%, Marvell Technology -9.6%, AppLovin -9.5%
Notable Macroeconomic News
Inflation Report: The core PCE price index rose to 2.8% from 2.7% previous, exceeding
expectations and intensifying inflation concerns.
Consumer Sentiment: Weak consumer sentiment data indicated growing
apprehension about the economic outlook.
Notable Corporate Earnings
Lululemon signals a consumer slowdown
Activewear maker Lululemon’s shares tumbled 14% as the company’s annual forecasts
for sales and profit disappointed, causing concerns that growth will remain weak in
American markets. Lululemon furthermore said that US shoppers are keeping their
wallets tight and visiting stores less often amid geopolitical strife and persistent
inflation.
Build Your Dreams (BYD): BYD is ‘charging’ ahead and gaining global momentum, with
record-breaking earnings, rapid international expansion, and stock performance that’s
outpacing Tesla. Innovation is driving the edge, from five-minute ultra-fast charging to a
diversified vehicle line-up including hybrids and cleantech solutions beyond cars.
Paychex (PAYX): Paychex on Wednesday reported higher-than-expected fiscal Q3
earnings, bolstered by revenue growth. Company management indicated checks per
client stayed flat, signalling a steady labour market, Morgan Stanley said.
The Open: Monday 31st March
Asian stocks tumbled to start the week. The Japanese Nikkei 225 index falling around
4% at their open. The Hang Seng index in Hong Kong opened 1% lower and the
Australian ASX 200 opening down approximately 1.75%. European Open has seen the
STOXX 600 index fall 1% and the FTSE 100 starting the week around 0.8% lower. Major
U.S. index futures are indicating a slight fall to kickstart the week. The Gold price rises
above the $3,100/oz mark amid widespread talk of stagflation and tariff uncertainty.
Goldman Sachs expects aggressive trade policies from the White House to raise
inflation and unemployment and drag economic growth to a near-standstill. The firm
raised its forecast for inflation this year to 3.5%, cut its GDP outlook to just 1% and
raised its unemployment view to 4.5%. Meanwhile, France imposed a €150M fine on
Apple over anti-competitive practices.
Week Ahead: 31st March -4th April 2025
Market Themes to Watch
Next week’s big event will be the 2nd April ‘reciprocal’ tariff deadline which Donald
Trump has referred to as ‘Liberation Day’. Investors will have to react to what is and isn’t
implemented in what threatens to be more far reaching that the import levies enacted
to date. Outside of the geopolitical noise, it is a relatively light on week from an
economic data and corporate earnings perspective. The economic calendar will have
investors eyeing off American labour market conditions for signs of an uptick in
unemployment through the JOLTS report and non-farm payrolls.
1. Trade Developments – Any changes or escalations in tariffs and retaliatory
actions as well as rhetoric around ‘Liberation Day’, will continue to drive impact
market sentiment. It is worth noting that market reactions are beginning to
become less extreme around new tariff announcements, but with more
retaliatory tariffs looming thick and fast on Wednesday, it will be a big test for
markets.
2. US Jobs Data & Fed Policy – A stronger-than-expected labour market could keep
interest rates higher for longer. February’s JOLTS job openings report will be
released on the 1st of April, and the week ends with U.S. non-farm payroll data.
3. UK Growth Outlook – With the final GDP print due, investors will assess the UK’s
economic resilience.
4. Monetary Policy – Central banks’ responses to inflation and unemployment data
will be closely monitored for indications of future interest rate adjustments.
5. Oil Prices & Geopolitics – Middle East tensions, Trump v Putin, and OPEC+
supply decisions could continue to shake oil and gas prices.
United Kingdom
Final Q4 2024 GDP Figures (2nd of April): The Office for National Statistics will release
the final estimate of the UK’s GDP growth for Q4 2024. This data will offer insights into
the country’s economic trajectory and potential policy responses.
Energy plays following Donald Trump’s threats to Putin. With further restrictions on
Russian oil & gas, additional tariffs on any countries doing business with energy
companies will be watched early in the week.
United States
March Jobs Report (4th of April): The Bureau of Labor Statistics will release
employment data, including non-farm payrolls and the unemployment rate. This report
is a key indicator of economic health and may influence Federal Reserve policy
decisions.
Manufacturing PMI (1st of April): The Institute for Supply Management will publish the
Manufacturing Purchasing Managers’ Index, reflecting the sector’s performance and
business sentiment.
ISM Services PMI (3rd of April): This index measures the economic condition of the
services sector, which constitutes a significant portion of the US economy.
Global markets ended the previous week on a mixed note, reflecting investor
uncertainty around economic data, interest rates, and geopolitical risks. In the US,
equities experienced volatility as investors balanced optimism over strong technology
sector earnings against concerns that the Federal Reserve might maintain higher
interest rates for longer. In the UK, the FTSE 100 was more resilient but faced some
downward pressure from cautious comments from the Bank of England regarding future
rate cuts and growth forecast downgrades from the OBR. European markets were
broadly steady, while in Asia, Chinese equities remained under pressure amid concerns
about sluggish economic growth, despite ongoing government stimulus measures.
Commodities also saw movement, with oil prices rising due to Middle East tensions and
gold remaining firm as a safe-haven asset ahead of upcoming economic reports.
Looking ahead to the first week of April, investors will be focused on Liberation Day
announcements and the implementation of existing tariffs and also the employment
data side. The US March jobs report will be a crucial indicator of the labour market’s
strength and could influence the Federal Reserve’s policy outlook. In the UK, final Q4
GDP figures will provide a clearer picture of the economy’s growth trajectory, helping
investors assess whether the country is managing to avoid a recession. Meanwhile,
geopolitical concerns could drive market volatility, particularly Ukraine developments,
Donald Trump’s use of threats against Russia will also stir commodity market volatility.
DISCLAIMER This article is for information purposes only and no part of it or its contents are deemed to be nor should be taken as advice. It does not constitute recommendations to buy or sell any securities mentioned. Past performance of investments is no guide to future returns and you may get back less than you invested. Capital at Risk.