US stocks slump as traders ditch the stocks previously immune from the sell-off
Stocks whipsawed as President Trump floated fresh tariffs on Canada, with the S&P 500 ending down 0.8% and the Russell 2000 off 0.3% while the tech-heavy Nasdaq 100 gained 0.2%.
Under the hood, it sure doesn’t seem like tariff talk played too large of a role today — General Motors, perhaps the company most impacted by trade barriers with Canada, actually rose.
Telling the tale of the tape today is relatively easy: if a stock had been getting creamed since February 19, the most recent closing high, through March 10, then it did well today. Conversely, if a stock had been holding up well through the carnage, it ceded ground today.
Said another way, every S&P 500 constituent that’s down 30% since the S&P 500’s record close, like Palantir, rose on Tuesday. And only two stocks of the couple dozen that are up 10% since February 19 rose on Tuesday.
Interestingly, this was the first time during the S&P 500’s retreat from its all-time high where the benchmark index fell and the equal-weight S&P 500 suffered a larger loss than the iShares MSCI USA Momentum Factor ETF (which actually ended higher on the day!). Investors ditched the safer stocks that had been holding up well while beaten-up names caught a bid.
Every S&P 500 sector ETF finished lower, with industrials, communications services, and consumer staples suffering the largest losses.
Kohl’s cratered, losing nearly a quarter of its value as its solid fourth-quarter results were overshadowed by abysmal guidance and a reduction in its quarterly dividend.
Dick’s Sporting Goods told a similar, but less severe, story and sold off after also exceeding its fourth-quarter earnings expectations while offering a dim outlook for 2025.
Shares of software company Oracle fell after posting lower-than-expected earnings and sales after the close on Monday.
Verizon also tumbled after its CRO warned of a “challenging” first quarter for the telecom company.
Southwest Airlines was a particularly bright spot on the tape today, rising 8% after ditching its “bags fly free” policy, a move which passengers will invariably despise.
