U.S. Stock Preview | Cryptocurrency concept stocks rise in pre-market as "Trump recession" alarm sounds

Pre-Market Market Trends

1. As of March 5 (Wednesday), U.S. stock index futures are all up before the market opens. As of the time of writing, Dow futures are up 0.69%, S&P 500 futures are up 0.80%, and Nasdaq futures are up 0.93%.

1. As of the time of writing, the German DAX index is up 3.27%, the UK FTSE 100 index is up 0.36%, the French CAC40 index is up 1.87%, and the Euro Stoxx 50 index is up 1.91%.

1. As of the time of writing, WTI crude oil is down 1.93%, priced at $66.94 per barrel. Brent crude oil is down 1.44%, priced at $70.02 per barrel.

Market News

"Trump Recession" Alarm Sounds! Economic Slowdown Back in Market Focus. With weak U.S. economic data and escalating trade tensions damaging consumer confidence and business activity, concerns about U.S. economic growth have once again become a focal point for financial markets. Francois Savary, Chief Investment Officer at Genvil Wealth Management, stated regarding the weakening confidence of U.S. consumers and businesses: "One thing is crucial for the economy, and that is confidence, which has been hit." "I do not believe a recession is a foregone conclusion, but this is also one reason we decided to reduce our investment in U.S. stocks." Candice Lane, CEO of the Canadian Chamber of Commerce, warned that U.S. tariff policies are pushing Canada and the U.S. toward "economic recession, unemployment, and economic disaster."

JP Morgan Turns Bearish on U.S. Stocks: Trump's Tariff Punches May Smash the U.S. Economic Engine. As U.S. President Trump launches a series of tariff offensives against countries worldwide, JP Morgan's trading department is preparing for further declines in the U.S. stock market, as tariffs will weigh on domestic and international economic growth. Andrew Tyler, Head of Global Market Intelligence at JP Morgan, stated that escalating trade tensions could lead to a significant downward revision of U.S. Gross Domestic Product (GDP) expectations and a substantial decline in earnings revisions. This will prompt Wall Street to reassess the year-end forecast for the S&P 500 index. He said: "In light of this, we will change our view to a tactical bearish stance on U.S. stocks." "Given the uncertainty, positioning, and the potential for negative feedback loops, it may prompt people to adopt recession strategies, and we believe a bearish position makes the most sense." Trump's tariffs dampen economic outlook, dollar falls to three-month low. The dollar weakened due to concerns that U.S. tariffs would negatively impact the economy. As of the time of writing, the dollar index (DXY) fell by 0.61% to 105.09. The dollar has been on a downward trend this week as the U.S. imposed trade tariffs on Canada and Mexico, heightening fears that a global trade war will hinder economic growth and force major central banks to cut interest rates further. The swap market indicates that the Federal Reserve is expected to cut rates by 71 basis points by the end of this year, up from last Friday's expectation of 66 basis points. Valentin Marinov, global forex strategy head at Crédit Agricole, stated, "The U.S. economy may slow further, forcing the Fed to restart its easing cycle in the second half of this year. The Fed may also have to end its quantitative tightening program to accommodate President Donald Trump's fiscal spending plans. This could undermine the notion of a dollar exceptionalism."

Oil prices continue to decline. On Wednesday, oil prices fell for the third consecutive trading day due to major oil-producing countries planning to increase output in April, coupled with market concerns that U.S. tariffs will slow economic growth and hurt fuel demand. In news, OPEC announced on the 3rd that eight OPEC and non-OPEC oil-producing countries decided to gradually increase oil production starting April 1 as planned. Additionally, economists believe that Trump's trade war will lead to job losses, slower growth, and rising prices, thereby stifling demand. IG market strategist Yeap Jun Rong stated, "The unfavorable supply-demand dynamics create a double whammy, with tariff uncertainties posing downside risks to global economic growth, which in turn affects oil demand. OPEC+ is still expected to increase production in April, while optimism about a resolution to the Russia-Ukraine conflict has raised the prospects of Russian supplies returning to the market."

Trump calls for termination of the CHIPS Act. On March 4 local time, Trump criticized the CHIPS Act in a speech at a joint session of Congress, stating that the act should be repealed. He urged House Speaker Johnson to "repeal" the law immediately and use the remaining funds for "debt reduction or any other effective use." However, although Trump called for Johnson to initiate the process to terminate the CHIPS Act immediately, Biden administration officials had already allocated most of the subsidy funds before leaving office, including binding subsidy agreements reached with the world's largest advanced chip manufacturers such as TSMC, Intel, Samsung Electronics, and Micron Technology, as well as binding subsidy agreements with chip giants like GlobalFoundries and Texas Instruments that produce older generation mature process chip products.

Individual Stock News

Popular Chinese concept stocks rise before market open. On Wednesday, before the U.S. stock market opened, as of the time of writing, GDS Holdings (GDS.US) rose over 7%, Kingsoft Cloud (KC.US) rose over 6%, XPeng (XPEV.US) rose nearly 4%, JD.com (JD.US) and Baidu (BIDU.US) rose over 3%, Tencent Music (TME.US), Alibaba (BABA.US), Bilibili (BILI.US), Nio (NIO.US), and iQIYI (IQ.US) rose over 2%, while Li Auto (LI.US) rose nearly 2% Cryptocurrency concept stocks rise before the market opens. As of the time of writing on Wednesday, U.S. stock futures show Bit Origin (BTOG.US) up over 15%, Cipher Mining (CIFR.US) and Bitdeer Technologies (BTDR.US) up over 5%, MARA Holdings (MARA.US) and Riot (RIOT.US) up over 4%, Strategy (MSTR.US) up over 3%, and Coinbase (COIN.US) up over 2%. In terms of news, cryptocurrency prices have surged. As of the time of writing, Bitcoin is up nearly 7%, approaching the $90,000 mark; Ethereum is up over 5%, Ripple (XRP) is up over 4%, SOL is up nearly 8%, and Cardano (ADA) is up nearly 22%.

Under political resistance, Tesla (TSLA.US) faces sales difficulties and launches "discount combos" to boost sales. It is reported that Tesla has begun offering lifetime free supercharging services for the Foundation series Cybertruck purchased after February 28. At the same time, it has introduced 0% annual interest or zero down payment offers for the Model 3, and significant discounts for older Model Y vehicles to accelerate the production of updated Tesla models. The more expensive Model X and Model S also come with lifetime supercharging services. Tesla's sales have been poor this year, with significant declines in Europe, China, and several Nordic countries, attributed to the huge controversy arising from CEO Elon Musk's involvement in political affairs. Data shows that Tesla's stock price has fallen over 32% year-to-date.

CrowdStrike (CRWD.US) Q4 performance exceeds expectations, but profit outlook is bleak. The financial report shows that CrowdStrike's total revenue for the fourth quarter of fiscal year 2025 grew by 25% year-on-year, reaching $1.06 billion, exceeding analysts' consensus estimate of $1.03 billion; non-GAAP operating profit was approximately $217.3 million, higher than the $213.1 million in the same period last year. The company's recurring revenue for fiscal year 2025 totaled approximately $4.24 billion, a year-on-year increase of 23%, surpassing analysts' consensus estimate of $4.12 billion. However, the company's performance guidance fell short of expectations. The company expects adjusted earnings per share for the three months ending April 30 to be between $0.64 and $0.66, far below analysts' previous expectation of $0.96. This indicates that the company may still be struggling to recover from a significant negative impact caused by a software update failure last year, which led to the crash of millions of computers worldwide, resulting in the widely impactful "global blue screen" incident. The company has repeatedly issued earnings outlooks below expectations, disappointing investors who have been closely watching for signs of recovery. As of the time of writing, CrowdStrike is down over 7% in U.S. stock futures on Wednesday.

Ross Stores (ROST.US) annual performance guidance is dim, consumer demand decline raises concerns. The financial report shows that Ross Stores' Q4 sales fell by 1.8% year-on-year to $5.91 billion, below analysts' expectations of $5.96 billion; Earnings per share were $1.79, while the market expected earnings per share of $1.66. Despite Ross Stores' efforts to attract more customers by offering a diverse range of products at different price points, this effort has not been successful, as its primary customer base—middle and low-income families—has begun to cut back on spending. The company expects same-store sales for fiscal year 2025 to decline by 1% to grow by 2%, while analysts expect a growth of 2.9%; it anticipates full-year earnings per share to be between $5.95 and $6.55, while the market expects $6.69. The company's guidance suggests that sales may decline further as tariffs and immigration crackdown policies loom. Additionally, the company's guidance, like that of its larger peers, shows that consumer demand is declining due to economic and geopolitical uncertainties.

Nordstrom (JWN.US) reported better-than-expected earnings in the fourth quarter, with privatization expected to be completed in the first half of the year. The financial report showed that Nordstrom's fourth-quarter revenue was $4.32 billion, a year-on-year decrease of 2.3%, which was $10 million lower than expected; non-GAAP earnings per share were $1.10, exceeding expectations by $0.17. Compared to the adjusted 13-week quarter of fiscal year 2023, total comparable sales in the fourth quarter increased by 4.7%. Fourth-quarter GMV decreased by 0.2% year-on-year; it is expected to grow by 3.1% in fiscal year 2024. Last December, Nordstrom announced it had agreed to be acquired by a consortium led by the company's founder John Nordstrom's great-grandson Eric Nordstrom and his brother Peter Nordstrom, along with the Mexican retail chain El Puerto de Liverpool. This acquisition will privatize Nordstrom and bring a new strategic chapter for the company. It stated that the privatization deal is expected to be completed in the first half of this year. As of the time of writing, Nordstrom's stock rose nearly 2% in pre-market trading on Wednesday.

ASML (ASML.US) annual report shows that export controls have led to weak demand, expecting a 20% decline in sales in China this year. In the annual report released on Wednesday, ASML stated that the uncertainty surrounding export controls is one factor weakening customer demand for 2024. ASML has been affected by the ongoing U.S.-led export restrictions on China. ASML noted that an increasing number of Chinese entities (which accounted for 36% of sales last year) are now restricted, and the company faces ongoing risks from increasingly complex restrictions and potential countermeasures. It stated, "Macroeconomic uncertainty—including (excessive) technological sovereignty and export controls—has led certain customers to remain cautious and control capital expenditures." The company previously indicated that it expects sales in China to decline by 20% in 2025. It reiterated its sales forecast for 2025 to be between €30 billion and €35 billion, up from €28.3 billion in 2024.

Important Economic Data and Event Forecasts

Beijing time 21:15 U.S. February ADP Employment Change

Beijing time 23:00 U.S. January Durable Goods Orders Month-on-Month Revision

Beijing time 23:00 U.S. January Factory Orders Month-on-Month

Beijing time 23:00 U.S. February ISM Non-Manufacturing PMI At 03:00 Beijing time the next day, the Federal Reserve will release the Economic Conditions Beige Book.

Earnings Forecast

Thursday pre-market: JD.com (JD.US), Macy's (M.US), Kroger (KR.US)