The US stock market declined in March amid a string of developments related to global trade, monetary policy, government, as well as individual companies and industries, with the drops in the tech sector offsetting the gains registered by energy and materials stocks. Among the three main indexes, the Dow Jones Industrial Average declined the most, by 2.06%, followed by the NASDAQ Composite and S&P 500, which slid by 1.63% and 1.37%, respectively. Overall, during the first quarter, the Dow Jones fell by 2.3%, the S&P 500 fell by 1.2%, while the NASDAQ Composite gained 2.3%.
US stocks started March on a positive note as they rebounded from the losses registered in the end of February regarding import tariffs and a potential trade war with China. On March 8, President Trump signed tariffs on steel and aluminum imports, despite opposition from the Congress and other stakeholders. Even though the tariffs provided an exemption for Canada and Mexico and left some wiggle room for other allies, the Commerce Department indicated that it would grant few exemptions, which put some pressure on stocks. On March 22, Trump signed a Memorandum imposing tariffs on over $50 billion of Chinese imports. The following day, China retaliated by saying it would impose tariffs on US goods as well and recently has revealed a list of over $50 billion of American imports, with the list of 106 products targeting soybeans, cars, chemicals, wine and pork. The tariffs don’t have a major impact on the trade between the two countries, which is estimated at around $650 billion a year, but both investors and economists are concerned that both sides are not done fighting and might eventually escalate into a full-blown trade war.
Other positive news seen in the first half of March included a robust job growth figure, with the US economy having added 313,000 jobs in February, which easily beat the expectations of 200,000 jobs, while the unemployment rate remained steady at 4.1% vs estimates of 4%. However, the unchanged unemployment rate was attributed to an increased participation rate to 63% from 62.7%. The positive jobs report and slightly stronger inflation prompted the Fed to hike the key interest rates by 25 basis points to 1.5% – 1.75%. The Fed also signaled two more rate hikes in 2018 and steeper increases in 2019 and 2020, citing a strong outlook on the economy.
While there was much news affecting the broader market, many individual companies were also in the spotlight. In particular, Facebook, Inc. (NASDAQ:FB) captured a lot of attention, as the stock plummeted on news that data firm Cambridge Analytica acquired access to private data on millions of users. The drop dragged the whole tech space lower in the second half of March. The scandal drew a lot of scrutiny and sparked a lot of criticism. Another company that attracted quite a lot of attention last month was Amazon.com, Inc. (NASDAQ:AMZN), which found itself attacked by President Trump on Twitter. In several tweets, Trump criticized the company, highlighting its relationship with the United States Postal Service and accusing the eCommerce giant of taking advantage of taxpayers by paying USPS lower shipping rates than it should.
Both Facebook, Inc. (NASDAQ:FB) and Amazon.com, Inc. (NASDAQ:AMZN) made the list of the 20 most searched tickers among Financial Analysts last month. According to data from TrackStar, InvestingChannel’s official newsletter capturing and analyzing the trends of Financial Advisors, Facebook, Inc. (NASDAQ:FB) and Amazon.com, Inc. (NASDAQ:AMZN) ranked on the 11th and 10th spots, respectively. Other companies that made the list include United States Steel Corporation (NYSE:X), which was the sixth most searched ticker amid the import tariffs on steel and aluminum and Apple Inc. (NASDAQ:AAPL), which was the seventh most-searched ticker in connection with trade policy concerns (China is one of Apple’s top markets) and product updates.
The top of the list of most searched tickers has Alibaba Group Holding Ltd (NYSE:BABA) on the third spot amid trade war concerns and reports about acquisitions that would expand the company’s presence, such as the online retail unit of Rochet Internet and a stake in eCommerce firm Lazada. The second most-searched ticker in March was Applied Optoelectronics, Inc. (NASDAQ:AAOI), which gained more attention after Lumentum Holdings Inc. (NASDAQ:LITE) said it would buy Oclaro Inc (NASDAQ:OCLR). The announcement sent most optical equipment makers stocks higher and Applied Optoelectronics, Inc. (NASDAQ:AAOI) was suggested to be a potential acquisition target as well.
Finally, the most-searched ticker among financial advisors in March was NVIDIA Corporation (NASDAQ:NVDA). The leading maker of GPU cards has been in the spotlight over the last year or so, as the cryptocurrency boom boosted the demand in its cards, which are the preferred choice among cryptocurrency miners. Over the last 12 months, NVIDIA Corporation (NASDAQ:NVDA)’s stock has surged by 119%, but in March the shares fell by almost 5%. The main reason for the decline was the accident that was caused by an Uber self-driving vehicle that resulted in a death of a pedestrian. The autonomous vehicle did not stop or slow down as it approached a woman that was walking outside of the crosswalk in Tempe, Arizona. The accident sparked concerns among the public, regulators, and carmakers regarding the safety of self-driving technology. NVIDIA Corporation (NASDAQ:NVDA) was affected because it is developing a platform for self-driving vehicles and has partnered with over 320 companies to advance the technology. In January at CES 2018, NVIDIA Corporation (NASDAQ:NVDA) said it was working with Uber, but after the accident it said that Uber does not use NVIDIA’s DRIVE platform, but just GPUs. Nevertheless, NVIDIA Corporation (NASDAQ:NVDA) suspended self-driving test program and introduced a simulator to test autonomous vehicles in virtual reality.
As the stock declined, some analysts suggested that the sell-off was overblown, since investors overly discounted the revenue loss and reputation risk. NVIDIA Corporation (NASDAQ:NVDA) made the right move to suspend real-life testing and the simulator should prove itself useful in continuing to advance self-driving technology in a safe environment.