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- 🙏 Is the Worst of The Market Crash Over?
🙏 Is the Worst of The Market Crash Over?
Here's what the experts are saying. Plus Dollar Store stocks are up, Shein pushes ahead with IPO plans, and Peleton jumps 16%...
Maxwell Nicholson
March 16, 2025
TOP STORY
😰 Is the Worst of The Market Crash Over? Some Experts Think So…
📉 It’s official - the markets entered ‘correction territory’ - a term Wall Street uses when the S&P 500 falls more than 10% from a recent high. Over the past month:
The S&P 500 fell 7.8%
The tech-heavy Nasdaq-100 fell 10.9%
The Canadian TSX index fell 3.7%
Bitcoin fell 13%
😅 And with all the market chaos and volatility, there is a TON to digest. So for today’s Weekly Buzz, I’m going to try my best to summarize the insane amount of information and answer 3 main questions:
1) Why the market is falling
2) Why many experts are saying the worst may be over
3) How retail investors (like you and me) are reacting to the dip (spoiler alert, they’re buying like crazy!)
🤞 Wish me luck…
📉 Why is the Market Falling?
😅 There’s endless news about the tariffs. I bet you could read about the tariffs all day if you wanted to, but according to analysts:
“The market's issue with tariffs isn't the tariffs themselves.”
🤷♂️ The issue is the uncertainty. Once there is clarity on the tariffs, investors can re-adjust expectations and fair-value calculations for the impacted companies.
🦠 We saw something similar in the COVID pandemic when uncertainty drove panic and crashed the markets. Now, rather than uncertainty about the impact of a global disease, we’re facing uncertainty around the impact of the tariffs.
😬 The problem is, it’s pretty unclear how long this uncertainty will last, and as one strategist puts it:
“We’re unlikely to see a material recovery in equities until we see the start of fiscal policy uncertainty abating.”
🐻 The biggest ‘bears’ in the market (investors who believe prices will go down) argue that these tariffs will plunge the US into a prolonged recession.
✨ But not everyone is so pessimistic, with JPMorgan and other top analysts saying that recession fears are overblown and the worst of the sell-off may be behind us…
🤿 But before we dive into what they’re saying, a quick word from this week’s sponsor Harvest ETFs!
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TOP STORY CONT.
😍 Why Some Experts Are Saying the Worst May Be Over
🙏 Despite a 10% dip in the markets, many of the leading analysts are optimistic:
JPMorgan says the worst of the sell-off is likely over and that the correction has actually been driven by ‘equity quant fund position adjustments’ and not recession fears.
Wells Fargo's Head of Equity strategy agrees that recession fears are overblown, citing inflation coming down, the Fed cutting rates, and saying that “just because things are difficult right now doesn’t mean we’re not going to have a good second half of the year.”
Earlier in the week Morgan Stanley claimed the S&P 500 correction will stall around the 5,500 level for the S&P 500 (which actual was close to the lowest point on Thursday before Friday’s rebound)
Goldman Sachs downgraded its S&P 500 outlook for the end of the year from 6,500 to 6,200, which, while a decrease, would still mean a +10% increase from current prices.
SoFi Head of Investment Strategy pointed out that the recent sell-off has been ‘purely sentiment based’ and that the market fundamentals are still strong - with forward earnings per share estimates actually increasing while the S&P is falling.
📊 If you’re newer to the markets, this crash may seem really scary, but research from Carson Group pointed out that -10% corrections are fairly par for the course - with 48 corrections in the S&P 500 since World War 2. Carson also points out that only 12 of these led to ‘bear markets’ (when the index falls by -20% from all-time highs).
“We've had a couple of pretty sanguine years and years where we didn't see the usual two or three pullbacks of 5% to 15%. [These pullbacks] are very typical thing to happen.”
A general theme here is analysts brushing off recession fears - but what does the data show?
💵 Inflation is Falling
February inflation rose only +0.2% compared to +0.5% in January
Core inflation (which excludes food and gas) saw the lowest yearly increase since April 2021, with rates coming close to the Fed’s 2% target
Once the Fed is comfortable that inflation is falling, they have more leeway to reduce interest rates (which is good for the markets)
💪 Credit Markets Are Strong
While equity markets show the odds of a recession at 50%+, credit markets are pricing in very low chances (<10%)
In the past two years, when the equity and credit markets disagreed, the credit markets were proven right.
🤑 Retail Investors Are Buying the Dip
So with all the turmoil how are retail investors like you and me reacting?
💰 They’re buying the dip!
According to Business Insider, since the market started falling - US ETFs have only had one day of outflows, with retail investors pouring in $7.3B into equities in the week since Wednesday.
🌼 Blossom data shows the same. This week:
S&P 500 ETFs (ZSP, VFV, VOO, SPY) had 9,301 buys and 1,721 sells (5.4x more buying than selling)
Nasdaq-100 ETFs (QQQ, QQC) had 2,493 buys and 507 sells (4.9x more buying than selling)
Nvidia had 2,283 buys and 885 sells (2.6x more buying than selling)
JPMorgan sees this as a positive sign for the markets:
"If US equity ETFs continue to see mostly inflows as they have thus far, there is a good chance that most of the current US equity market correction is behind us."
😌 While no one really knows what the future holds, I personally am feeling more optimistic after all my research for this edition of the buzz. Last week I shifted ~$3K from the CASH ETF (a high-interest savings ETF that pays a 2.7% yield) into ZSP S&P 500 ETF last week and plan to buy more on Monday!
ALSO IN THE NEWS
🗞️ Other Key Headlines this Week
📈 Dollar General Rises as the Market Falls
While the market falls, Dollar General ($DG) is up 9% in the past month and up 6% since Wednesday after reporting higher-than-expected earnings.
With over 60% of Dollar General’s sales coming from households with an income of <$35,000, high inflation and economic turmoil are good news for the stock as consumers look for lower-cost options
Dollar General has low exposure to tariffs, with 80% of its sales coming from mostly non-perishable food items made in the US.
Despite this jump, Dollar General is still down -47% in the past year and was one of the biggest losers in the S&P 500 for both 2023 and 2024 after a CEO shake-up, missed earnings, and increased competition.
🚴♀️ Peleton Jumps 16% On Friday After a Month of Declines
Another stock that jumped this week was the exercise equipment company Peleton ($PTON), which rose 16% after Canaccord upgraded the company from a hold to a buy, claiming the company is at a turning point with 'meaningful upside potential’.
Analysts have an average $10.59 price target for Peleton according to Visible Alpha, 50% higher than the current stock price.
Despite a +49% stock increase in the past 6 months, Peleton is still -95% below the all-time highs reached during COVID and, according to management, it ‘still has a steep hill to climb to reach sustained, profitable growth.
👗 Clothing Retailer Shein Still Plans to IPO Despite Tariff and Market Uncertainty
Shein, a Chinese global fast-fashion retailer focused on women’s clothes, is still committed to its IPO plans despite being heavily impacted by Trump’s decision to end tariff-free imports of small goods from China.
Shein is facing pressure to significantly slash its IPO valuation to $30B - well below its $100B valuation in 2022 as the company struggles with dwindling enthusiasm.
The CEO thinks an IPO would help the company earn public trust and increase transparency amid allegations of poor factory conditions.
🤠 There’s a New Stock Exchange in Town…
The Texas Stock Exchange (TSXE), an upstart stock exchange that plans to launch in early 2026, has been stealing top talent from Nasdaq and CBOE with plans to go after the $11 trillion ETF market.
The executives poached reportedly managed more than 40% of all ETF products in the US.
The TSXE has raised $161M from investors like BlackRock, Citadel Securities, and Charles Schwab and is currently seeking regulatory approvals to operate a national securities exchange.
FROM THE BLOSSOM COMMUNITY
⭐️ Featured Discussions this Week
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