Trading results for 5 March 2025
Wednesday fully demonstrated the ongoing market instability. After weeks of declining prices, investors were prepared for anything, and optimism was in short supply. Adding to the gloom, macroeconomic data released before the main trading session brought further disappointment: ADP reported a weaker-than-expected increase in non-farm employment (77,000 instead of the forecasted 141,000). Given this, it was surprising that markets opened near zero rather than at lower levels. Attempts to push prices down did occur, but each time, the bulls managed to recover and pull indexes into positive territory.
A wave of optimism arrived when news broke that U.S. President Donald Trump would exempt certain automakers from the 25% import tariffs on goods from Canada and Mexico and was considering further exemptions. This immediately sent shares of leading car manufacturers soaring. General Motors (GM, +7.21%) surged by almost 9% during the session, while Ford Motor (F, +5.81%) gained nearly 6%. Tesla (TSLA, +2.60%), which is less reliant on imports from neighbouring countries, also rose, though seemingly just in solidarity.
This positive development boosted market sentiment, leading to a much stronger second half of the session. By the close, all major U.S. indexes posted solid gains, partially recovering from recent losses.
The upbeat mood extended to the ITS indexes, particularly the global market index ITS World (ITSW), which closed nearly 2% higher (+1.88%). Interestingly, American companies were not the primary drivers of growth. Among the top 10 gainers, only Microsoft (MSFT, +3.19%) made the list, ranking eighth. Instead, Chinese companies led the charge, with Alibaba (BABA, +8.61%) and JD.com (JD, +6.86%) showing strong performance. Alibaba, in particular, staged a remarkable comeback, erasing its 10% pullback over the past week and setting the stage for further gains.
European stocks also performed well, notably Israeli firm WIX.com Ltd. (WIX, +4.91%), which was added to the ITSW index just a month ago. Its shares climbed nearly 5% after closing a gap left in December following strong earnings. Meanwhile, Swiss banking giant UBS Group AG (UBS, +2.76%) saw increased demand following the appointment of new board members, with investors optimistic that fresh leadership would be beneficial.
The ITS Shariah Index (ITSS) saw more modest growth, gaining +0.24%. The top performers within the index included two pillars of the U.S. economy: industrial giant Caterpillar (CAT, +3.59%) and the previously mentioned Microsoft. Caterpillar’s rebound was particularly notable. In recent weeks, its shares struggled under the weight of new 25% tariffs on imports from Mexico and Canada, alongside an increase in tariffs on Chinese goods to 20%. These measures hit Caterpillar hard, given its global operations and extensive workforce outside the U.S. (61,400 employees compared to 51,500 domestically).
The announcement of potential tariff exemptions for some automakers lifted Caterpillar’s shares as investors speculated that similar relief could be extended to industrial manufacturers. The company operates numerous production facilities worldwide, including in China and Mexico, where rising component costs threaten profit margins.
Despite Wednesday’s positive close, the market situation remains uncertain. Indexes are hovering near key support levels, broader concerns persist, and investors remain cautious about their next move. While uncertainty is an inherent part of the market, it remains a source of anxiety. The VIX volatility index declined by nearly 7% after Wednesday’s session but remains above 20 points, signalling ongoing market turbulence.