U.S. Stock Outlook | "Triple Witching" Arrives Tonight, Nike and FedEx Drop After Earnings

Pre-Market Market Trends

1. As of March 21 (Friday), U.S. stock index futures are all down. As of the time of writing, Dow futures are down 0.25%, S&P 500 futures are down 0.22%, and Nasdaq futures are down 0.30%.

1. As of the time of writing, the German DAX index is down 0.72%, the UK FTSE 100 index is down 0.47%, the French CAC40 index is down 0.59%, and the Euro Stoxx 50 index is down 0.61%.

1. As of the time of writing, WTI crude oil is down 0.48%, priced at $67.74 per barrel. Brent crude oil is down 0.56%, priced at $71.60 per barrel.

Market News

The strongest "Triple Witching Day" of the year is here! Over $4.5 trillion in options face expiration. U.S. stock investors have a potential hurdle to overcome before the weekend arrives—on Friday, options contracts related to stocks worth over $4.5 trillion will expire on the latest quarterly "Triple Witching Day." This will make the size of the options expiring on Friday the largest since last December. Since options expiration often accompanies market volatility, there is usually a sense of unease in the market before significant options expiration dates. On February 21, the last monthly options expiration date, the S&P 500 index fell nearly 2%. However, after experiencing a period of market turbulence (the S&P 500 briefly fell into correction territory earlier this month), some believe that the options expiration on Friday may actually help restore calm to the market. Brent Kochuba, founder of options market data and analysis provider Spot Gamma, stated, "If the market rebounds slightly after the Federal Reserve meeting, then I actually think the impact of this options expiration will be quite neutral."

Government downsizing backfires on the economy! Economic analysts warn: DOGE layoffs may impact the U.S. economy. The Trump administration, with the assistance of the government efficiency department led by Musk (DOGE), has massively cut federal government staff, prompting many critics to argue that these layoffs will adversely affect the U.S. economy. Economic analyst Steve Liesman stated that the impact of DOGE is the primary reason for the layoffs, followed by market and economic conditions, and then corporate bankruptcies; most government department layoffs may have only just begun and will not yet be reflected in the February non-farm payroll report; these workers will not be counted as unemployed until their severance pay is exhausted According to Liesman, the "ultimate economic impact" of the Trump administration and DOGE layoffs depends on whether the "private sector can provide jobs for these unemployed individuals" and "whether it can compensate for the losses caused by these job losses."

"New Bond King" Gundlach warns: recession risk intensifies, market volatility may return. Jeffrey Gundlach, CEO of DoubleLine Capital, stated that as the risk of recession increases, the market may face another painful period of volatility. He said, "I think investors should have adjusted their portfolios a long time ago... We are about to face a new round of risks." He also pointed out that the likelihood of a recession in the coming quarters is between 50% and 60%. Gundlach stated, "I do believe the likelihood of a recession is higher than most people think. In fact, I believe the probability of a recession in the next few quarters exceeds 50%." Gundlach advised U.S. investors to reduce their reliance on U.S. securities and look for opportunities in Europe and emerging markets.

Citi warns that hard landing risks could trigger historic gold market, with gold prices rising for eight consecutive days aiming for $3,500. Citi Research raised its forecast for gold futures prices over the next three months to $3,200 per ounce, an increase of $200 from its previous estimate. If concerns about worsening U.S. economic troubles persist, gold prices could climb to $3,500 by the end of the year. Citi stated, "In our view, gold prices will reach $3,500/ounce by the end of the year due to fears of a U.S. hard landing/stagflation, which will significantly increase hedging/investment demand, supporting gold prices." "If President Trump’s plan to lower energy prices fails to sufficiently offset tariff-driven inflation, and if the U.S. labor market deteriorates further, the stock market continues to decline, and household fear levels rise... it could drive gold prices to new highs."

Individual Stock News

As Tesla (TSLA.US) shares plummet, Musk urges employees to continue holding company stock. Tesla CEO Elon Musk urged employees at a company-wide meeting on Thursday to "continue holding" Tesla stock, despite the company facing "difficult times." Musk stated at the meeting, "There will be tough times, but I’m here to tell you that the future is bright and exciting." Data shows that Tesla's stock price has dropped 41.5% this year, nearly 52% from its peak last December, erasing gains made after Trump's election victory. Meanwhile, Musk is increasingly betting Tesla's future on robots and autonomous driving. Musk mentioned at the meeting that the humanoid robot Optimus has completed manufacturing on the trial production line at the Fremont factory and will enter trial production this year. Musk stated that the goal for this year is to produce 5,000 units of Optimus, and the ordered components are sufficient to support the production of 10,000 to 12,000 units this year, with a target of producing 50,000 units of Optimus by 2026. Additionally, Musk stated that the company's goal is to scale up the production of the autonomous taxi Cybercab to "new heights." NVIDIA (NVDA.US) will open a quantum computing research center in Boston! Quantum computing concept stocks fell before the market. NVIDIA will establish a quantum computing research laboratory in Boston, expected to begin operations later this year. NVIDIA stated that the NVIDIA Accelerated Quantum Research Center (NVAQC) will combine leading quantum hardware with artificial intelligence supercomputers to achieve what is known as accelerated quantum supercomputing. NVIDIA mentioned that quantum computing innovators, including Quantinuum, Quantum Machines, and QuEra Computing, will collaborate with researchers from universities such as Harvard University and the Massachusetts Institute of Technology at NVAQC. As of the time of writing, quantum computing concept stocks fell broadly before the market on Friday, with Quantum Computing (QUBT.US) down over 10%, SEALSQ Corp (LAES.US) and Arqit Quantum (ARQQ.US) down over 5%, D-Wave Quantum (QBTS.US) down nearly 5%, and RGTI (RGTI.US) down over 3%.

Tariff pressure and declining consumer confidence hit hard! Nike (NKE.US) warns of a potential double-digit decline in Q4 sales. According to the financial report, Nike's Q3 revenue fell 9% year-on-year to $11.27 billion, compared to market expectations of $11.01 billion; the company's sales decline was mainly due to its weak performance in the Chinese market, where Q3 sales in this key region dropped 17% to $1.73 billion, below the market expectation of $1.84 billion. Earnings per share were $0.54, compared to market expectations of $0.29. The gross margin decreased by 3.3 percentage points to 41.5%, below the market expectation of 41.8%, primarily due to the costs incurred by Nike to clear old inventory and launch new innovative styles. The company attributed the gross margin decline to "higher discounts, higher inventory write-down reserves, higher product costs, and changes in channel mix." Meanwhile, Nike warned that due to the longer-than-expected recovery plan and challenges from new tariffs and declining consumer confidence, Q4 sales are expected to see a double-digit percentage decline. The company's Chief Financial Officer Matt Friend stated that the sales decline for Q4 of the fiscal year ending in May is expected to be at the lower end of the "around 15% range." Additionally, due to increased efforts to clear excess inventory and outdated styles that are no longer favored by consumers, as well as the impact of tariffs imposed by the U.S. on products from China and Mexico, the company expects gross margins to decline by 4 to 5 percentage points, and this process is expected to continue until the fiscal year 2026. As of the time of writing, Nike's stock fell over 6% in pre-market trading on Friday.

The AI infrastructure boom is in full swing, with explosive growth in storage demand! Micron (MU.US) data center revenue triples. According to the financial report, Micron Technology's Q2 revenue surged 38% year-on-year to $8.05 billion, exceeding analysts' average forecast of $7.91 billion; among this, the revenue from storage chips closely related to the large-scale construction of AI data centers tripled. Adjusted earnings per share rose to $1.56, far exceeding the approximately $0.42 from the same period last year and surpassing the analysts' average expectation of $1.43 In addition, the company expects total revenue for Q3 to be approximately $8.8 billion, higher than the analysts' average expectation of $8.55 billion; it anticipates adjusted earnings per share (EPS) of about $1.57, also above the analysts' average expectation of around $1.48. As of the time of writing, Micron Technology fell over 3% in pre-market trading on Friday.

Tariff gloom looms, logistics giant FedEx (FDX.US) lowers full-year expectations. The financial report shows that FedEx's revenue for the third quarter was $22.2 billion, compared to $21.7 billion in the same period last year, a year-on-year increase of 2.3%, while analysts expected $21.91 billion; net profit was $910 million, up from $880 million in the same period last year, a year-on-year increase of 3.4%; diluted earnings per share (EPS) were $3.76, compared to $3.51 in the same period last year. In terms of guidance, FedEx had already lowered its EPS expectation for the fiscal year 2025 from $20-22 to $19-20 last December, and this time further narrowed it to $18-18.60. Revenue expectations were also adjusted from "flat with last year" to "flat or slightly down," reflecting the lagging impact of tariff policies on cross-border trade. In fact, behind the financial warning is a harsh reality. The U.S. industrial economy continues to be weak, and the demand for transportation between enterprises has stagnated. As of the time of writing, FedEx fell nearly 8% in pre-market trading on Friday.

Nio (NIO.US) achieved total revenue of RMB 65.7316 billion in 2024, a year-on-year increase of 18.2%, with record high vehicle deliveries. The financial report shows that in 2024, vehicle deliveries reached 221,970 units, an increase of 38.7% compared to 2023. Vehicle sales amounted to RMB 58.2341 billion ($7.978 billion), an increase of 18.2% compared to the previous year. The gross margin for vehicles was 12.3%, compared to 9.5% in the previous year. Total revenue was RMB 65.7316 billion ($9.0052 billion), an increase of 18.2% compared to the previous year. Gross profit was RMB 6.4928 billion ($889.5 million), an increase of 112.8% compared to the previous year. The gross margin was 9.9%, compared to 5.5% in the previous year.

Miniso (MNSO.US) 2024 annual report: Overseas stores exceed 3,000, with overseas total revenue increasing by 42% year-on-year. The financial report shows that in 2024, Miniso Group's total revenue reached RMB 17 billion, a year-on-year increase of 22.8%, with overseas revenue increasing by 42.0% to RMB 6.68 billion. The gross margin was 44.9%, an increase of 3.7 percentage points compared to the same period last year, setting a new historical high. Adjusted net profit (Non-IFRS) was RMB 2.72 billion, a year-on-year increase of 15.4%, with an adjusted net profit margin of 16.0%, and adjusted diluted earnings per share increased by 16.0% year-on-year to RMB 8.68, demonstrating strong business resilience and robust profitability. In terms of store growth, as of December 31, 2024, the group had a total of 7,780 stores worldwide, a net increase of 1,219 stores, with overseas stores exceeding 3,000, achieving another milestone

Important Economic Data and Event Forecast

At 20:30 Beijing time, 2025 FOMC voting member and Chicago Fed President Goolsbee will participate in a CNBC program.

At 21:05 Beijing time, FOMC permanent voting member and New York Fed President Williams will deliver a speech