Weekly Market Update

Weekly Market Update for the Grand Protector

Market Overview:

The past week was marked by continued market volatility, with stocks experiencing significant fluctuations in response to President Trump's tariff policies and concerns over economic growth. Despite some rebounding on Friday, the S&P 500 (^GSPC) officially entered correction territory, shedding more than 10% from its February record high.

Key Sectors:
• Consumer Staples: This sector continues to attract inflows as traders seek out businesses less tied to economic cyclicality. Coca-Cola (KO), PepsiCo (PEP), and Procter & Gamble (PG) shares have all risen in March, while the iShares US Healthcare ETF (IYH) has gained 1.2% this month.
• Health Care: The IYH has tacked on 1.2% in March, powered by gains in top holdings Merck (MRK) and Amgen (AMGN).
• Utilities: The Utilities Select Sector SPDR Fund (XLU) is up about 1%, relatively unchanged in March, outperforming the S&P 500.

Notable Stocks:
• Amazon (AMZN): Shares are trading on a forward price-to-earnings multiple of 30 times, their lowest P/E in three years. Lower valuations for top tech names come amid a broader rout in markets.
• Nvidia (NVDA) and Tesla (TSLA): These megacap tech stocks have led the sell-off in recent days, with Nvidia down more than 15% and Tesla plummeting 20% since February.

Market Insights:
• Economic Growth Forecasts: Economists are downgrading their outlooks for economic growth this year due to concerns over President Trump's tariff policies.
• Tariff Uncertainty: The lack of clarity on tariffs is driving volatility in the market, with investors uncertain about the impact on various industries and companies.

Recommendations:

Considering the market's current state, we recommend maintaining a diversified portfolio with exposure to consumer staples, healthcare, and utilities. These sectors have historically been less sensitive to economic cyclicality and may provide a stable foundation during times of market uncertainty.