Selloff Monday as Uncertainty Continues

• US Markets Lower as VIX Climbs: US100 -0.97%, US500 -0.56%, US30 -0.10%, US2000 +0.07%. VIX jumps +2.90% to 23.03.
• European Selloff Intensifies: AUT20 -2.33%, DE40 -2.02%, EU50 -1.79%, W20 -1.60%, UK100 -1.41%. VSTOXX surges +6.29% to 21.98.
• DOJ Pushes Google Chrome Divestiture: Justice Department maintains Alphabet should sell Chrome browser. Google stock lower.
• Tesla China Sales Plummet: February deliveries down 49% year-over-year to 30,688 vehicles. Market share below 5% as BYD sales surge 161%.
• Rocket to Acquires Redfin for $1.75B

Major US indices are showing predominantly negative performance. The BRAComp is down -1.11% to 125334, while the US100 has fallen -0.97% to 19816.76. The US500 is down -0.56% to 5695.5, and the US30 has declined -0.10% to 42506. The MEXComp remains unchanged at 0.00%, while the US2000 has gained slightly, up +0.07% to 2056.5. Notably, the VIX fear gauge has jumped +2.90% to 23.03, indicating rising market anxiety.

European markets are experiencing significant declines across the board. The Austrian AUT20 is the hardest hit, falling -2.33% to 4193, followed by Germany’s DE40 down -2.02% to 22767.2. The EU50 has dropped -1.79% to 5423.6, while Poland’s W20 declined -1.60% to 2589.6. The UK100 is down -1.41% to 8628.5, and Spain’s SPA35 fell -1.26% to 13159. Other notable declines include the Netherlands’ NED25 (-1.25% to 907.22), Italy’s ITA40 (-1.24% to 38447), France’s FRA40 (-1.15% to 8113.4), and Switzerland’s SUI20 (-0.97% to 13008). The VSTOXX volatility index, meanwhile, has surged +6.29% to 21.98, signaling heightened risk aversion in European markets.

S&P 500 Sectors Show Mixed Performance. Source: Bloomberg Financial LP

Current volatility observed on Wall Street. Source: xStation 

The Nasdaq-100 index, represented by the US100 contract, trades below 61.8% Fibonacci retracement level. The RSI is consolidating near oversold levels, while the MACD continues to diverge lower. Source: xStation

Market News

• S&P 500 Welcomes Four New Members: DoorDash (DASH), TKO Group (TKO), Williams-Sonoma (WSM), and Expand Energy (EXE) will join the S&P 500 index following S&P Dow Jones Indices’ quarterly rebalance announcement. The four companies will replace Borgwarner (BWA), Teleflex (TFX), Celanese Corp. (CE), and FMC Corp. (FMC), which will move to the S&P SmallCap 600 effective March 24. DASH shares rose modestly in Monday trading, while AppLovin (APP), one of 2024’s hottest performers, fell sharply after being snubbed from the index additions.
• Robinhood Settles with FINRA for $30 Million: Shares of Robinhood Markets (HOOD) dropped 10% to $39.80 after two of its units agreed to pay nearly $30 million to settle allegations from the Financial Industry Regulatory Authority. FINRA identified violations at Robinhood Securities and Robinhood Financial related to anti-money laundering programs, disclosure practices, and clearing system supervision, with some violations dating back more than a decade. The settlement includes $3.8 million in restitution to customers affected by “order collaring,” a now-discontinued practice.
• DOJ Maintains Tough Stance on Google Antitrust Case: The Department of Justice reaffirmed its position late Friday that Google-parent Alphabet should be forced to sell its Chrome web browser as part of antitrust remedies. The DOJ also maintained its proposal to end Google’s internet search-related payments to Apple. Wall Street’s hopes for a softer approach under the Trump administration appear to be fading, with Google stock indicated slightly lower Sunday night.
• Intuitive Machines Faces Second Moon Landing Setback: Intuitive Machines (LUNR) shares plunged 13% after the space exploration company confirmed its second lunar lander, Athena, landed on its side near the moon’s south pole—mirroring issues from its first attempt last year. Despite collecting approximately 250 megabytes of data for NASA, the company doesn’t expect the lander to recharge due to solar panel orientation and extreme cold temperatures. Meanwhile, competitor Firefly Aerospace celebrated a successful lunar touchdown of its Blue Ghost lander, marking the most successful soft landing by a private company to date.
• Rocket Companies Acquires Redfin in $1.75 Billion Deal: Rocket Companies (RKT) announced plans to acquire real estate listing site Redfin (RDFN) in an all-stock transaction valuing the company at $1.75 billion. Rocket will pay $12.50 for each Redfin share, a 63% premium over the 30-day volume-weighted average price. Redfin shares surged more than 80% in premarket trading, while Rocket shares fell approximately 10%. The deal is expected to close in Q2 or Q3 2024, with Redfin CEO Glenn Kelman continuing to lead the business under Rocket CEO Varun Krishna.
• IBM Wins Trade Secret Lawsuit Against LzLabs: IBM secured a legal victory in London against Switzerland-based LzLabs and its owner, tech entrepreneur John Moores, in a trade secrets case. IBM had accused LzLabs’ UK subsidiary of purchasing an IBM mainframe computer in 2013 and using it to reverse-engineer IBM’s proprietary software. The judge ruled that LzLabs breached IBM’s software license terms, with a damages hearing to follow. IBM’s case against another British subsidiary and LzLabs’ current and former CEO was rejected.
• Tesla Faces Declining Share in Chinese EV Market: Tesla Inc.’s shipments in China plunged 49% in February year-over-year to just 30,688 vehicles, the lowest monthly figure since July 2022. While some decline was expected due to production lines being retooled for efficiency and the Model Y refresh, Tesla has been backsliding in China for five consecutive months. The automaker now holds less than 5% market share in China, ranking 11th among all automakers. Morgan Stanley projects Tesla’s China exposure to fall from 21% of total revenues in 2024 to around 6-7% by 2030. The stock is currently down 7%.

Other news coming from individual S&P 500 index companies. Source: Bloomberg Financial LP

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