Stock Indexes Slide While Gold and Bonds Hold Steady
Market Recap for the Week of March 16, 2025
Most major stock indexes posted marginal declines last week, while bonds held their ground, and commodities such as gold delivered positive returns. Energy and Utilities were the only two positive sectors of the S&P 500 for the week. Spreads on high-yield bonds have also been widening, which is another sign that investors expect some economic pain. The term spread refers to the difference in yields between a risky corporate bond and government bonds. A higher yield on the risky corporate bond implies that investors demand more compensation to take the additional risk of the corporates bond. In other words, the bond market is signaling that the economy might weaken. The bond market could be wrong, but time will tell.
At the end of the day, there is still a lot of uncertainty about the outcome of tariffs. Because of this, volatility is likely to continue. Next week will be important for economic data. Starting on Monday (St. Patrick’s Day), we will get retail sales data for February. Later in the week, we will receive data on building permits and other leading economic indicators. Fed Chair Jerome Powell will deliver an interest rate decision on Wednesday. Currently, the market is pricing in a 98% chance of no change in the Federal Funds rate.
“While stocks showed small declines, widening high-yield bond spreads suggest investors are bracing for potential economic weakness.”
Chart of The Week
Our chart of the week, which comes from Apollo Asset Management, presents a very concerning picture. As seen in the chart title, half of U.S. households have no retirement assets. I would be less surprised by young people having no retirement assets, but seeing that 43% of people between the ages of 55 and 64 have nothing in their retirement accounts is deeply concerning. This is one argument for the necessity of Social Security, as a large portion of the population is either unable or unwilling to save for retirement. Unfortunately, many of these individuals take Social Security early, which is likely to leave them impoverished for the remainder of their lives.
The commentary in this blog is for informational purposes only and should not be taken as personalized investment advice
Chart of the week Source: Survey of Consumer Finances 2022, Haver Analytics, Apollo Chief Economist
