[New York Stock Market] Ends Slightly Higher on 'Tariff Exemption' Hopes... Gains Limited by Weakening Consumer Sentiment

Barely Achieving a Three-Day Winning Streak
Focus on Trump's "Mutual Tariff Exemption" Remarks
Gains Limited by 'Lowest in Four Years' Consumer Confidence Index
Attention on February Core PCE Price Index to Be Released on the 28th

The three major indices of the U.S. New York Stock Exchange closed slightly higher on the 25th (local time). Despite a sharp deterioration in consumer sentiment due to concerns about a tariff-induced economic recession, investors focused on President Donald Trump's remarks on mutual tariff exemptions from the previous day, allowing the market to barely achieve a three-day consecutive rise. However, the gains were minimal amid growing concerns over a slowdown in consumption, which accounts for two-thirds of the U.S. economy.

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On this day in the New York stock market, the blue-chip-focused Dow Jones Industrial Average (Dow) closed at 42,587.5, up 4.18 points (0.01%) from the previous trading day. The large-cap-focused S&P 500 index rose 9.08 points (0.16%) to 5,767.65, and the tech-heavy Nasdaq index gained 83.26 points (0.46%) to close at 18,271.86.

Following President Trump's remarks on mutual tariff exemptions, which sparked a strong rally the previous day, the market continued its upward trend shortly after opening. However, after the release of data indicating a sharp deterioration in consumer sentiment due to concerns over an economic recession caused by tariff policies, buying and selling pressures were evenly matched, significantly reducing the gains by the end of trading.

According to the economic research group Conference Board (CB), the Consumer Confidence Index for March recorded 92.9, down 7.2 points from the revised February figure of 100.1. This is the lowest level in four years since early 2021. The expectations index, reflecting short-term outlook for the next six months, fell 9.6 points from the previous month to 65.2, marking the lowest level in 12 years. It was well below 80, a level considered a signal of an impending recession. The expected inflation rate one year ahead rose to 6.2% in March from 5.8% in February, reaching the highest level in two years.

The Consumer Confidence Index is an indicator that reflects consumers' confidence in the U.S. economy, suggesting that recent consumer economic outlooks have become more pessimistic. The Conference Board explained, "Responses from companies showed that inflation remains a major concern for consumers," adding, "Concerns about trade policies and tariffs have increased, and mentions of economic and policy uncertainties have risen more than usual."

Brett Kenwell, U.S. investment analyst at eToro, said, "Concerns about the economy and economic policy uncertainties are hitting the sentiments of investors, consumers, and businesses, causing their confidence to continue weakening," and analyzed, "Until clarity on tariffs and macroeconomics improves, sentiment and confidence are expected to remain fragile."

Vanu Baveja, Chief Investment Strategist at UBS Group AG, forecasted, "Noticeably fatigued U.S. consumers will put additional pressure on stock prices," and predicted, "As analysts lower earnings estimates over the next three to four months, the S&P 500 index could fall to 5,300 points."

Investors are expected to seek clearer assessments of the U.S. economic situation through additional indicators to be released this week. The U.S. Department of Commerce will release the February core Personal Consumption Expenditures (PCE) price index on the 28th. Based on Bloomberg's estimates, the core PCE price is expected to rise 2.7% year-over-year, up from 2.6% in January. The final GDP growth rate for the fourth quarter of last year will be announced a day earlier on the 27th. On April 4th, the U.S. Department of Labor will release the March employment report, providing more accurate information on the U.S. labor market conditions.

By individual stocks, U.S. electric vehicle maker Tesla rose 3.45%. Apple increased by 1.37%, and Microsoft (MS) showed a 0.53% gain. Nvidia fell 0.59%.

U.S. Treasury yields were slightly lower. The 10-year U.S. Treasury yield, a global bond yield benchmark, fell 1 basis point (1 bp = 0.01 percentage points) to 4.31% from the previous trading day, while the 2-year U.S. Treasury yield, sensitive to monetary policy, dropped 2 basis points to 4.01%.

International oil prices closed slightly lower following news that Russia and Ukraine agreed to a Black Sea maritime ceasefire through U.S. mediation. West Texas Intermediate (WTI) crude oil fell $0.11 (0.16%) to $69 per barrel, and Brent crude, the global oil price benchmark, decreased by $0.02 (0.03%) to $73.02 per barrel.