Trading results for 26 February 2025
The entire trading day on Wednesday revolved around Nvidia (NVDA, +3.67%) and anticipation of its earnings report. The market largely ignored weak real estate data – both the number of building permits issued and new home sales for January fell short of forecasts. However, investors reacted nervously and sharply to reports that President Trump might introduce 25% tariffs on imported chips, directly impacting Taiwan Semiconductor Manufacturing (TSM), the primary supplier for NVDA.
Riding these waves of news, index prices surged in anticipation of strong NVDA earnings but later dropped following negative updates from the White House. Nevertheless, NVDA shares remained firmly in the green throughout the day, reflecting investors’ confidence in a positive outcome.
Ultimately, all the market turbulence ended right where it started – at neutral levels. The Dow Jones Index (DJIA-30) fell by 0.43%, largely due to Boeing (BA, -2.93%) and Amgen (AMGN, -2.93%), which both lost 3% of their market capitalisation. Meanwhile, the NASDAQ Composite saw a slight increase (+0.26%), primarily driven by NVDA. As for the key benchmark of the U.S. market, the S&P 500, it remained flat, gaining a symbolic 0.01%.
A similar trend was observed in the ITS family of indexes. The geographically diversified ITS World Index (ITSW) performed relatively well, thanks in part to Chinese stocks, as well as NVDA and its sector peers like Broadcom (AVGO, +5.13%). The index ended the day with a solid 0.90% gain. The best-performing stock in ITSW for the second consecutive day was Chinese automotive giant Li Auto (LI, +10.30%), which has added nearly 25% to its market cap over this period.
As for the ITS Shariah Index (ITSS), gains from NVDA and AVGO were offset by the continued decline of the biggest underperformer of recent days – Tesla (TSLA, -3.96%). Over the past week alone, Elon Musk’s company has lost more than 20%, and judging by investor sentiment, the downturn is far from over. It remains to be seen whether Musk will focus on politics or on rescuing his rapidly depreciating business. For now, ITSS, weighed down by Tesla’s slump, failed to break into positive territory and closed with a minor loss of 0.13%.
Slight gains here, slight losses there – but overall, the situation remains unchanged. The market is not ready to decline, as there is no clear reason for a drop, yet it also lacks the strength to grow further, with most positive factors seemingly already priced in. For now, the current sideways trend remains the dominant investment theme, and expecting anything more from the market might be premature.