S&P 500 Forecast: SPX falls on trade tariff uncertainty & jobs data

US futures

Dow future -0.87% at 42617

S&P futures -1.15% at 5773

Nasdaq futures -1.5% at 20300

In Europe

FTSE -0.87% at 8660

Dax  0.4% at 23202

• Trump delays auto tariffs for 1 month
• Challenger job cuts soar 245%
• US jobless claims fall to 221k from 242k
• Oil rises from a multi-year

Trade tariff uncertainty hits sentiment

US stocks point to a weaker open as investors weigh up the latest trade tariff developments and mixed jobs data.

The White House announced a one-month exemption from the newly imposed 25% tariffs on auto imports from Mexico and Canada, bringing some relief to US vehicle makers. This will provide the manufacturers time to adjust their supply chains and explore long-term solutions, given that Mexico and Canada are integral to the US supply chain. There are also reports that Trump is considering exempting some agricultural products from the tariffs.

While these latest developments suggest the administration could be open to negotiations, the general uncertainty surrounding the trade outlook is impacting U.S. companies as they attempt to plan for the future.

Meanwhile, data showed that US layoffs increased 245% from January, the highest monthly count since July 2020. Over one-third of this total came from Elon Musk's efforts to reduce federal headcount. Of the 172,000 and 17 layoffs for the month, 62,242 were Federal job cuts.

US jobless claims came in stronger than expected, falling to 221 K for the week ending March 1st, below expectations of 235 K. These figures come after ADP payrolls tumbled to 77K yesterday, down from 183 K, and ahead of tomorrow's keenly awaited nonfarm payroll report.

The market has been concerned that Trump’s tariffs could push the economy into recession. A weak jobs report tomorrow could fuel those fears.

Corporate news

Macy’s is falling 3.5% after the department store chain forecast annual sales and profits below expectations, concerned that consumers were holding off from buying clothing and accessories in the face of economic uncertainty.

Marvell fell 17% after the chipmaker's quarterly results failed to impress investors hoping for strong AI-driven growth.

Alibaba is rising 1.9% after the Chinese conglomerate said the release of a new reasoning model was on par with the global hit DeepSeek’s R1.

S&P 500 forecast – technical analysis.

The S&P 500 is once again testing the 5770 support level, the third test in 3 days. A break below here brings the 200 SMA into focus at 5750, which has stemmed losses so far this week. Should sellers, supported by momentum, take out this level, it opens the door to a deeper selloff to 5700. Should the 200 SMA hold, buyers will then look to test resistance at 5865 and above there 5916, which could negate the near term selloff.

FX markets – USD falls, EUR/USD rises

The USD is struggling around a 4-month low amid concerns of an economic downturn in the US amid a trade war on multiple fronts.

EUR/USD is rising after the ECB cut rates by 25 basis points, in line with expectations. Policymakers noted rates were becoming meaningfully restrictive which could hint to a more cautious approach to cuts. Attention will now turn to the press conference, where ECB President Christine Lagarde could provide further insight into the outlook for rates.

GBP/USD is falling against the USD after UK construction activity slumped to its lowest level since the pandemic. The construction PMI fell to 44.6 in February from 48.1 in January, its weakest level since May 2020. The housebuilding sub-component dropped to 39.3 from 44.9, marking one of the sharpest downturns on record.

Oil recovers from a multi-year low

Oil prices are edging higher after 4 days of losses. The price is recovering from a multi-year low amid some relief surrounding trade tariffs.

Trump delaying auto trade tariffs has raised hopes of further walk-backs on the 25% tariffs on Mexico and Canada and 20% tariffs on China, helping oil prices stabilise after the recent selloff.

Oil prices have fallen sharply on concerns that trade tariffs could spur a US recession and hurt the oil demand outlook. At the same time OPEC+ have said they will press ahead with plan production increases from next month, increasing supply as the demand outlook deteriorates.

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