Trading results for 27 February 2025
Another sell-off, and once again, President Trump is to blame – these are the grim results of Thursday's session. Yet, the day started on an entirely different note. Nvidia’s (NVDA, -8.48%) excellent quarterly report, while causing some investor caution, was still widely acknowledged as strong. This gave hope for a halt to the market’s decline, which had begun a week ago, and even for a potential rebound. Futures on major U.S. indexes, up by as much as 0.8% in the first half of the day, seemed to indicate that as well.
However, market sentiment took a hit with macroeconomic data on initial jobless claims, which rose to 242,000 instead of the forecasted 222,000. Even so, the main trading session opened in positive territory, with indexes gaining around 0.5%. But the bulls’ strength was short-lived.
The bears quickly seized the initiative and kept pressing. Within the first hour of trading, all indexes except for the Dow slipped into the red. A fierce battle between bulls and bears unfolded near the break-even point. At one stage, it seemed like things were not so bad: “Well, +0.1% or -0.1% – not much of a difference.” That might have been so if not for Trump’s tariff announcement.
Midway through the session, news broke that tariffs on goods from Canada and Mexico – initially postponed until 1 March and expected by many to be delayed again until 2 April – would instead take effect on 4 March. This announcement triggered a massive sell-off, which quickly spiralled out of control.
The worst spoke in a cart breaks first. Until that moment, Nvidia’s shares had been in the red but down only about 2–3%. However, as soon as the tariff news hit, a widespread sell-off ensued. This dragged down the entire semiconductor sector and, subsequently, the broader tech industry, including the Magnificent Seven stocks. The tech sell-off resulted in the worst day for the NASDAQ indexes: NASDAQ 100 (-2.75%) and NASDAQ Composite (-2.78%), with significant losses for the Dow Jones (-0.45%) and S&P 500 (-1.59%).
Unfortunately, the sell-off also affected the ITS index family. The ITS World Index (ITSW) and the ITS Shariah Index (ITSS) suffered significant losses, dropping by 1.82% and 2.47%, respectively.
A closer look at ITSW’s performance on Thursday shows that only one-third of its 50 companies ended the day in positive territory. Most of the gains came from Asian and European stocks. The best performer of the day was Swiss real estate insurance firm Chubb Limited (CB, +2.93%), which gained nearly 3%. Financial stocks fared relatively well, with payment processors Visa (V, +1.46%) and MasterCard (MA, +0.63%) showing resilience.
Notably, Kazakhstani company Kaspi.kz (KSPI, +0.53%) managed to buck the trend, making every effort to withstand the sell-off in U.S. big tech stocks.
As for the ITSS Islamic index, the sell-off had a more pronounced impact. However, the ratio of gainers and losers was similar to ITSW: one-third of stocks finished in the green, while two-thirds – in the red. Visa and MasterCard also led the gains here. Additionally, stocks from the healthcare sector (MRK, AZN, JNJ) and consumer goods companies (PEP, KO) helped mitigate the decline.
Nevertheless, a sell-off is a sell-off. A correction had been brewing, and now we are seeing its consequences. The key question is whether this is the extent of it or if further downside awaits. We may get an answer as soon as Friday when crucial consumer inflation data (PCE index) is released.