Monthly Market Insights - March 2025
Greetings Team,
A Tale of Two Markets: Grit, Growth, and the Great Wrestling Upset
As we close the books on March, we can’t help but borrow a few famous words from Charles Dickens: “It was the best of times, it was the worst of times.”
Right now, the market looks fairly resilient—or ready to crack—depending on where you’re standing and who you ask. Consumer sentiment is slipping, tariffs are grabbing headlines, and fears of a recession are louder than ever.
And yet, the economy itself? Still chugging along, fundamentals largely intact.
It’s a tale of two market narratives: one driven by politics, polls, and pessimism, the other by data, discipline, and a dash of grit. Let’s dive right into this month’s market moves.
Markets in Review: March Madness, Wall Street Edition
March was no walk in the park for investors. Equity markets declined for the second straight month, weighed down by political uncertainty, tariff announcements, and cooling sentiment:
📉 S&P 500: 5,611.85 (-5.75% MoM | -4.37% YTD)
📉 NASDAQ: 17,299.29 (-8.21% MoM | -10.28% YTD)
📉 DOW: 42,001.76 (-4.20% MoM | -0.92% YTD)
Growth stocks bore the brunt of this pullback, while defensives and select value tickers held up better. The tech-heavy, AI-sensitive NASDAQ continued its slide—down over 10% for the year.
But beneath these market jitters, the U.S. economic machine kept humming. Inflation eased slightly, with February’s CPI clocking in at +0.2% MoM and +2.8% YoY. Meanwhile, unemployment remains historically low at 4.1%, and GDP estimates are still pointing to modest but positive growth.
The disconnect between market movement and economic fundamentals? That’s what makes investing fun, right?
Fed Watch: Rate Cuts, But Not (Yet)
In its March 19 meeting, the Federal Reserve held rates steady at 4.25–4.50%, but the tone of the announcement struck a careful balance.
Chairman Jerome Powell acknowledged “solid” economic growth and a “strong” labor market but also noted that inflation remains “somewhat elevated.” Powell emphasized that uncertainty has grown—but not enough to derail the central bank’s expectation of two rate cuts later in 2025.
One particularly revealing moment came during the FOMC press conference when Powell admitted that President Trump’s tariffs are a key contributor to the Fed’s higher inflation outlook. However, he also added that weaker growth and higher inflation “kind of balance each other out.” Translation: The rate cut pace remains intact, for now.
While outside economists are dialing up their recession predictions, Powell pushed back: “Still at relatively moderate levels... not high.” Unsurprisingly, the markets rallied as he spoke—proof that tone matters just as much as policy.
Recession Talk: Been There, Done That
So, are we headed into a recession? Depends on how you define one. If you’re going by the old textbook definition (two quarters of negative GDP growth), we arguably already had a recession back in 2022. It just didn’t get labeled that way because definitions changed, and narratives shifted.
Here at TSG, we view the recession question differently. If we do end up seeing a recession in 2025, by the time it’s “official,” it will likely be over. That’s just how economic cycles (and government reporting) work.
The real story? We believe in what we’re calling the Trump Floor: a built-in buffer under the new administration that limits the market’s potential downside. Between aggressive pro-growth policies, a protective stance on trade, and the Trump administration’s aversion to prolonged market pain, we expect any U.S. economic decline to be short-lived.
Lutnick & Trump: Betting Big on Growth
In other news, Commerce Secretary Howard Lutnick made headlines in March with a firm, bold call: “There’s going to be no recession in America.” In interviews with NBC’s Meet the Press and Fox News, Lutnick reiterated the Trump administration’s position: we’re in a transition, not a downturn.
He pointed to the upcoming April 2 tariff wave, which aims to strike back at global trade imbalances. While this could temporarily lift prices on foreign goods, Lutnick insists it will boost domestic producers, strengthen American manufacturing, and eventually lower grocery prices.
Lutnick added, “If Donald Trump is bringing growth to America, I would never bet on recession—no chance.” Whether you agree or not, the administration’s confidence is a strong signal to markets: corrections will be tolerated. But crashes? Not on their watch.
Wrestling With Volatility: Hendrickson’s Upset and Market Grit
If there was one story this month that summed up the average investor’s March experience, it was the Wyatt Hendrickson vs. Gable Steveson heavyweight showdown at the NCAA Wrestling Championships.
Trailing 4–2 with just seconds remaining, Hendrickson—an underdog from Oklahoma State—scored a shocking takedown against Olympic gold medalist Gable Steveson, winning the heavyweight national title in what’s now being called “the biggest upset in NCAA wrestling history.”
After the victory, Hendrickson saluted President Trump in the crowd and said of the final seconds: “I made up my mind... I didn’t care if I had to rip my arms off, squeezing him. I was holding this man down and winning this match.”
That, folks, is the spirit of long-term investing. In volatile markets, grit pays off. Panic-selling is like jumping off a moving train—you’ll only get left behind, bruised, and beating yourself up as you scramble to buy back in at higher prices. But those who hold on, even when they’re behind on the scoreboard, often find themselves on the podium when the final buzzer sounds.
Looking Ahead: April 2, CPI, and Staying the Course
Next month brings a few big moments to watch:
April 2 Tariff Deadline: Trump says this time it’s final. Expect volatility around global trade headlines.
March CPI Release (April 10): If inflation ticks up, the Fed could delay cuts; if it falls, expect markets to breathe easier.
Earnings Season Kickoff: Q1 results will help clarify whether corporate America is feeling the heat—or passing it on.
Despite recent drawdowns, our outlook remains cautiously optimistic. The noise may be getting louder, but the underlying fundamentals remain strong. The market may wobble, but it hasn’t lost its footing.
If you’re wondering what to do amid all this uncertainty, we’ll borrow one final quote from Kiplinger’s Jeffrey Kosnett:
“Do not sell anything due to a news event for three trading days.”
In other words: stay the course, folks. And, as always, onward and upward!
Steven and Daniel
STEVEN W. SCHMITT, MBA, CFP®, CPM®, CRPS®, ADPA®
Managing Director, Private Wealth Advisor
CA Insurance # 0G61253
The Schmitt Group of Raymond James
Raymond James & Associates, Inc. // 3CV
61 S. Paramus Road Suite 360, Paramus NJ 07652
Direct 551.497.5531 // Text 201.559.0775 // eFax 201.291.4298
steven.schmitt@raymondjames.com
raymondjames.com/schmittgroup
Member of the Raymond James Pride Financial Advisors Network
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