Intel shares jumped following news that TSMC has extended a joint venture to American chip manufacturers. PepsiCo, on the other hand, fell due to a brokerage downgrade. The latest CPI data revealed inflation slowed more than expected in February. As a result, the Dow was down 0.20%, the S&P 500 was up 0.49%, and the Nasdaq added 1.22%.

Cautious growth after plunge

The US stock market showed cautious growth on Wednesday, fueled by inflation data that came in below expectations. This temporarily eased the wave of sell-offs that had previously swept across the exchanges. However, the ongoing trade confrontation initiated by US President Donald Trump continues to dampen investor enthusiasm.

Tech stocks on the rise, Dow struggles

The S&P 500 and the Nasdaq indices ended the day in the green, with the latter receiving a strong boost from tech stocks. Meanwhile, the Dow Jones swung between gains and losses throughout the session, ultimately closing with a modest loss.

Inflation under control, Fed may ease policy

US Department of Labor data showed a more significant decline in consumer prices than analysts had anticipated. This strengthened hopes that inflation is under control and reinforced expectations that the Federal Reserve will ease monetary policy, lowering key interest rates later this year.

New phase in trade conflict

Meanwhile, Washington announced a 25% tariff on steel and aluminum imports. In response, Canada and the European Union declared mirror measures against US exports. This step further escalated trade tensions between the United States and its major economic partners.

Recession fears grow

Markets continue to feel pressure amid the intensifying tariff conflict, resembling a game of "eye for an eye." Investors are concerned that a sharp rise in the cost of imported goods could slow the economy and trigger a recession not only in the US but also in Canada and Mexico.

Analysts from top investment banks share these concerns. Goldman Sachs has revised its S&P 500 forecast downward, while JPMorgan notes growing risks of an economic slowdown in the US.

The stock market remains torn between hopes for interest rate cuts and fears of the consequences of a trade war. How these conflicting factors will affect the economy will become clearer in the coming months.

S&P 500 struggles to hold above critical level

Despite Wednesday's gains, the S&P 500 remains 8.9% below its all-time high set less than a month ago. Earlier in the week, the key index broke below its 200-day moving average for the first time since November 2023 — a crucial technical level that traders view as critical support.

Nasdaq officially in correction phase

On March 6, the tech-heavy Nasdaq index officially entered a correction phase, losing more than 10% from its peak posted on December 16. This signals significant pressure on the high-tech sector, with investors increasingly concerned about its future growth prospects.

Mixed market performance: Nasdaq gains, Dow loses ground

The results of Wednesday's trading session showed mixed dynamics among key indices:

• The Dow Jones Industrial Average (.DJI) fell by 82.55 points (-0.20%) to 41,350.93.
• The S&P 500 (.SPX) rose by 27.23 points (+0.49%) to 5,599.30.
• The Nasdaq Composite (.IXIC) gained 212.36 points (+1.22%) to settle at 17,648.45.

Nasdaq's rally was driven by a surge in tech stocks, while the consumer staples and healthcare sectors showed weaker performance.

Tech sector in focus: Intel on the rise

Tech giants led the market rally. Among the 11 key sectors in the S&P 500, technology showed the strongest performance.

Intel (INTC.O) rose by 4.6% following reports that Taiwan's TSMC (2330.TW) had offered major US chipmakers — Nvidia (NVDA.O), Advanced Micro Devices (AMD.O), and Broadcom (AVGO.O) — the opportunity to purchase stakes in a joint venture managing Intel's factories.

This news sparked optimism among investors, as such collaboration could strengthen Intel's position in the market and reduce the US semiconductor industry's reliance on Asian suppliers.

PepsiCo disappoints market

While the tech sector pleased investors, not all companies managed to maintain a positive outlook.

PepsiCo shares fell by 2.7% after Jefferies analysts revised their recommendation, downgrading the stock from "buy" to "hold." This shift in ratings affected investor sentiment, as changes in the ratings of major companies often signal potential risks.

Congress under pressure: shutdown threat looms

Debates continue to rage on Capitol Hill over a bill to temporarily fund the US government. Lawmakers have been unable to reach a compromise, increasing the risk of a partial government shutdown. This political instability is heightening nervousness in the stock markets, adding another layer of uncertainty to an already complex economic landscape.

Asian markets follow Wall Street's lead, posting strong gains

Asian stock markets showed solid growth on Thursday, tracking the positive momentum of US indices. Easing inflationary pressures in the United States calmed investor concerns, sparking a rally in technology stocks.

• Japan's Nikkei (.N225) rose by 0.9%, boosted by gains in chipmakers such as Advantest and Tokyo Electron.
• Taiwan's tech-heavy index (.TWII) strengthened by 0.6%, while South Korea's KOSPI (.KS11) added 0.7%.
• Chinese blue chips (.CSI300) saw a modest increase of 0.1%, though Hong Kong's Hang Seng lost 0.3%, giving up earlier gains.

Investors in the region continue to monitor trade and geopolitical developments that could influence market trends.

Bonds under pressure: yields remain elevated

US Treasury bonds maintained high yields following a recent recovery. The rise in yields was triggered by escalating trade tensions between the United States and its key economic partners. Investors are concerned about further tariff wars, which could pressure global markets and slow economic growth.

EUR holds steady despite US threats

In the currency markets, the euro held its ground after falling from a five-month high on Wednesday. Pressure on the single currency increased following U.S. President Donald Trump's comments about potential retaliatory measures against the European Union if Brussels moves forward with plans to impose new tariffs on U.S. goods.

However, the euro continues to receive support from investors amid signs of progress in negotiations between Russia and Ukraine. An improving geopolitical situation in Europe may mitigate risks and provide short-term support for the euro.

US inflation slows, but risks persist

Recent inflation data showed that US consumer prices rose by 0.2% in February, a significant slowdown from January's 0.5% spike. Excluding volatile components such as food and energy, the core Consumer Price Index (CPI) also increased by 0.2%, down from 0.4% the previous month.

These figures confirm market expectations of a potential easing in inflationary pressures. However, analysts warn that the Federal Reserve's focus is not solely on the CPI but also on the Personal Consumption Expenditures (PCE) index. Key components that contributed to the CPI slowdown are not included in the PCE calculation, leaving questions about the Fed's future monetary policy.

In addition, investors are eagerly awaiting the release of the Producer Price Index (PPI) later Thursday. This data could provide further insights into whether the decline in inflation is a sustainable trend or just a temporary effect.

US Treasury yields resume gains

Uncertainty in global trade and ongoing tariff wars have led US Treasury yields to continue rising, recovering from recent lows.

• The yield on 2-year Treasury bonds climbed to 4.005% on Wednesday, up from 3.829% the previous day, the lowest level since October last year.
• The last recorded yield was 3.924%, signaling that investors are factoring in potential changes in the Fed's policy.

The rise in yields indicates that market participants are becoming less confident in a near-term interest rate cut, despite the slowdown in inflation.

USD holds steady, but markets remain cautious

The US dollar found support from rising bond yields, maintaining stability against the euro.

• On Thursday, the greenback held steady at 1.0895 per euro, after weakening to 1.0947 on Tuesday, its lowest level since October 11.

Despite its relative stability, the dollar remains under pressure. Investors are concerned that President Trump's trade policies, including new tariff restrictions, could slow down the economy and, in the worst-case scenario, lead to a recession. These risks are prompting traders to adopt a more cautious approach toward the US currency.

JPY weakens after rally to October highs

The Japanese yen, traditionally considered a safe-haven currency, retreated to 146.205 per dollar after reaching its highest level since October 4 — 146.545 — on Tuesday.

The sharp rise in the yen was driven by increased demand for safe-haven assets amid market instability. However, the currency correction indicates that investors are partially locking in profits and reassessing future prospects.

Upside momentum in Japanese bond yields fizzles out

After a sharp rise, the yield on Japan's 30-year government bonds began to retreat. On Thursday, the yield dropped to 2.53%, after reaching 2.615% on Wednesday, the highest level since 2006.

Bank of Japan Governor Kazuo Ueda commented on the rise, stating that it reflects market expectations of future interest rate hikes. This confirms the central bank's determination to gradually move away from ultra-loose monetary policy, which could further alter the dynamics of Japan's bond market.

Gold climbs, approaching historic highs

Gold prices continue to rise, reflecting heightened demand for safe-haven assets. The precious metal gained 0.3%, reaching $2,943.49 per ounce. This level is just $13 below the historic high of $2,956.15 reached on February 24.

Investors continue to flock to gold amid global economic uncertainty and potential shifts in Federal Reserve policy.

Oil market stabilizes after sharp gains

Following a strong rally on Wednesday, oil prices pulled back slightly.

• Brent crude oil futures fell 0.1% to $70.88 per barrel.
• US West Texas Intermediate (WTI) dropped 0.2%, settling at $67.57 per barrel.

Oil prices have stabilized, balancing demand concerns with supportive factors such as US inventory data showing a drawdown. Market focus is now on upcoming OPEC+ decisions and global demand for crude.

Bitcoin continues recovery after recent dip

The cryptocurrency market is showing signs of recovery. Bitcoin rose by 1%, reaching $84,000. This follows a sharp drop to $76,666.98 on Tuesday, its lowest level in the past four months.

The recovery in digital assets may be linked to renewed interest from institutional investors and an overall improvement in sentiment in the crypto market. However, high volatility remains a key factor that market participants are closely monitoring.