Last week brought significant market volatility with the S&P 500 ($SPX) (SPY) suffering substantial weekly losses despite a strong Friday rebound. President Donald Trump's implementation of new tariffs dominated market sentiment, with the European Union and other trading partners announcing retaliatory measures. The resulting trade tensions weighed heavily on export-sensitive sectors while raising concerns about potential inflation impacts.
Here are 5 things to watch this week in the Market.
Fed Decision and Rate Path
Wednesday's Federal Open Market Committee (FOMC) statement at 2 pm, followed by Chair Powell's press conference, represents this week's most consequential market event. While no rate change is expected, the Fed's updated economic projections and dot plot will provide crucial insights into the path of monetary policy for the remainder of 2025. Markets will particularly focus on whether officials maintain their cautious stance on inflation or show increased confidence in its downward trajectory. Any shift in the projected number or timing of rate cuts could trigger significant market moves, with rate-sensitive sectors like utilities, real estate, and financials potentially seeing outsized reactions.
NVIDIA's GTC Event
Tuesday's NVIDIA (NVDA) GTC conference keynote at 1 pm ET, featuring CEO Jensen Huang, could significantly impact the broader AI narrative and tech sector sentiment. Analysts anticipate the unveiling of NVIDIA's next-generation GB300 AI chip, alongside advancements in agentic AI, robotics, and accelerated computing. Given NVIDIA's central role in the AI boom and its outsized influence on market sentiment, any major product announcements or performance claims could create volatility in AI-related stocks. The market reaction could extend beyond chipmakers to include AI infrastructure, cloud providers, and potential AI application companies.
Triple Witching Expiration
Friday marks the March triple witching expiration when stock options, stock index futures, and stock index options all expire simultaneously. This quarterly event typically brings elevated trading volumes and potential volatility, particularly in the final hours of trading. The expiration can lead to complex positioning by institutional traders and heightened market movements as large positions are adjusted or rolled forward. Individual stocks with substantial options open interest could see increased volatility, while broader market indices might experience "pinning" effects around major strike prices as expiration approaches.
Retail Sales Data
Monday's Retail Sales report at 8:30 am will provide fresh insights into consumer spending trends. Following recent mixed signals about consumer resilience, this data takes on additional importance for gauging economic momentum. A stronger-than-expected report could ease concerns about economic slowdown, potentially benefiting consumer discretionary sectors. Conversely, weakness in retail sales might fuel growth concerns, particularly if discretionary categories show significant declines. The market will focus not just on the headline number but also on the composition of spending across different retail categories for a more nuanced view of consumer behavior.
Housing Market Indicators
This week brings several important housing market readings, including Tuesday's Housing Starts and Building Permits data at 8:30 am, followed by Thursday’s Existing Home Sales report at 10 am. With mortgage rates remaining elevated despite recent modest declines, these indicators will help assess how the housing sector is navigating affordability challenges. Given housing's significant role in the broader economy and its sensitivity to interest rates, these reports could influence expectations about economic growth and consumer health. Homebuilders and housing-related retail stocks could see notable reactions based on these releases.
Best of luck this week and don't forget to check out my daily options article.
