February 2025 Market Snapshot

Rosemeyer Management Group

February in Review

February brought us a volatile month in global markets. A solid first half of February evidenced by modest gains was interrupted by a final two weeks of market reversals sparked by weaker-than-expected economic reports. All major U.S. indices experienced monthly declines with the S&P 500 declining 1.30% for the month. Meanwhile, international stocks experienced positive returns for the second month in a row. Al-focused tech stocks lead the late February declines as market darling Nvidia announced its earnings. The company beat its earnings estimates, but narrowing margins provided the basis for investor consternation. Soft future guidance from Walmart as well as continued uncertainty surrounding tariffs contributed to the slight market sell-off. Bonds had a strong 2% month with treasury yields falling on economic news

Index	1 Month	Year-to-Date
Dow Jones Industrial Average	-1.39%	3.32%
Standard & Poor's 500 Average	-1.30%	1.44%
Russell 2000 (Small Cap Index)	-5.35%	-2.87%
Total U.S. Stock Market	-1.94%	1.13%
MSCI ACWI ex USA (Intl. Index)	1.39%	5.47%
Barclay's U.S. Agg. Bond Index	2.20%	2.74%

Source: Morningstar

Looking Forward: What’s Ahead for Q3 & Beyond

This volatility is not abnormal. It is typical to see heightened volatility in the months following presidential elections. Going back to 1980, market returns within 6 months of an election have varied from +26% to -12%. Thus, these market swings are typical as markets grapple the policy outlooks of incoming presidents. With that being said, the difficult-to-gauge tariff policy of the Trump administration has been met by cautious investors as they get their feet under them for the coming years. The AtlantaFed’s GDPNow model is projecting a contraction in Qs GDP, which could be due in part from increased import activity in anticipation of coming tariffs. However, the majority of Wall Street analysts are predicting a positive first quarter. This is largely due to strong underlying fundamentals of the U.S. economy – YoY purchasing activity is expanding and consumer demand remains resilient.

The Personal Consumptions Expenditure (PCE) index – the Fed’s preferred inflation gauge showed a modest 2.5% YoY reading exactly as expected. This calmed investor nerves about the Fed potentially reversing its rate cut policy as the central bank is expected to keep rates unchanged at the coming meeting with a cut or two anticipated by year-end. The market will continue to watch the Federal Reserve closely as we move into their March meeting.

On a Personal Note

It is March! Spring is around the corner (hopefully) and basketball seasons of all levels are entering their postseasons. Whether your bracket is busted or you are rooting on your loved ones at the high school and collegiate level, this time of year can be “madness.” We wish all local teams the best of luck as they seek to make deep postseason runs. We also want to congratulate any and all local wrestlers who have finished or are nearing the end of their season!

Rosemeyer Management Group

Licensed in CO, FL, IA, IL, MA, MN, MO, NV, NY, WA, WI, WV & TX J.P. Morgan Asset Management, July 1, 2025 · NASDAQ.com, July 1, 2025

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