What we’re reading (3/10)
“Stock Market Today: Nasdaq Falls 4% After Trump Doesn’t Rule Out Recession” (Wall Street Journal). “Stocks slid Monday as concerns about the U.S. economy tipping into a recession grew. The Dow gave up nearly 900 points, the S&P 500 fell 2.7% and the Nasdaq Composite tumbled 4% as shares of big tech companies extended their selloff. Tesla's stock lost 15%. Shares of the other Magnificent Seven stocks—Apple, Microsoft, Alphabet, Amazon.com, Nvidia and Meta Platforms—fell between 2% and 5%.”
“Tesla Shares Plunge 15%, Suffering Steepest Drop In Five Years” (NBC News). “Tesla’s selloff on Wall Street intensified on Monday, with shares of the electric vehicle maker plunging 15%, their worst day on the market since September 2020. On Friday, Tesla wrapped up a seventh straight week of losses, its longest losing streak since debuting on the Nasdaq in 2010. The stock has fallen every week since CEO Elon Musk went to Washington, D.C., to take on a major role in the second Trump White House.”
“Are Palantir’s Passive Bona Fides Hurting The Stock?” (Institutional Investor). “[W]hile passive investment facilitates momentum investing and pushes stocks up because of regular buying for retirement accounts, it also can create ‘wild swings’ due to the lack of active managers to take the other side of the trade if things start to go south. (Green previously worked for Thiel’s macro hedge fund.)”
“Fed To Deliver Rapid-Fire Rate Cuts If Economic Downturn Happens, Traders Bet” (Reuters). “The Federal Reserve won't lower interest rates at its policy meeting next week, but could deliver the first of a set of rapid-fire reductions in borrowing costs in June if rising fears of an economic downturn triggered by a trade war materialize. At least that's where the betting is in futures markets, where contracts that settle to the Fed's policy rate were increasingly priced for quarter-percentage-point reductions in June, July and October following U.S. President Donald Trump's remarks last weekend about a "period of transition" as he ratchets up tariffs on China, Canada and Mexico. U.S. stocks and Treasury yields also dropped on Monday on concern that his comments signaled a coming recession.”
“Trump Wants To Kill Carried Interest. Wall Street Will Fight To Keep It.” (DealBook). “Nearly a month has passed since President Trump last spoke publicly of his desire to kill the carried interest loophole. (Yes, we know, some of you don’t consider it a ‘loophole.’) And yet the private equity industry, which stands to lose big if the president upends the tax break, is still bracing for a fight.”
