Thierry Hasse: Keep both hands on the wheel
Navigating the U.S. financial markets increasingly resembles driving a race car through an obstacle course. Just as a skilled driver must anticipate sudden barriers, sharp turns and unexpected slowdowns, today’s investors need to remain focused, adapt to changing conditions and avoid overreacting to market turbulence. And much like driving through unpredictable terrain, keeping both hands firmly on the wheel – not on the SELL button – is another good tactic to help you get to the checkered flag.
Here’s a look at last week’s market conditions and what lies on the road ahead.
Chief Investment Officer Thierry Hasse
Market Movers: Feb. 3–7
Trade uncertainty keeps markets on edge
On Monday, Feb. 3, investors were met with flashing caution signs: Headlines announcing new tariffs on Canada, Mexico and China set to take effect the very next day. Markets braced for impact as uncertainty surged. However, last-minute phone calls with leaders to the north and south of U.S. borders resulted in a 30-day pause on tariffs for Canada and Mexico. Meanwhile, the 10% tariff on all Chinese imports proceeded as scheduled.
Despite the temporary reprieve for North American trade, the abrupt shifts in policy rattled investors, reinforcing the unpredictability of trade negotiations. China responded swiftly, announcing retaliatory tariffs of 10% to 15% on U.S. energy exports and agricultural machinery, set to take effect today, Feb. 10.
Consumer confidence declines amid inflation fears
Consumer sentiment took a detour last week, as the University of Michigan’s index showed a decline. With inflation expectations exceeding 4% over the next year, consumers hesitated to accelerate their spending. Headlines about government layoffs and agency closures added to the caution, much like encountering roadblocks on a long journey.
Tech spending sparks investor concerns
Earnings season left some major tech stocks stuck in traffic. While Meta managed to stay in the fast lane, Amazon, Google and Microsoft faced slowdowns despite meeting or exceeding earnings expectations. Investors grew uneasy as companies unveiled plans to spend $300 billion in 2025 on AI development — after already investing $240 billion in 2024. Meanwhile, reports that China’s DeepSeek was advancing AI at lower costs created further frustration, prompting some investors to question whether U.S. tech giants were taking the most efficient route.
Navigating the Road Ahead: Key Events for Feb. 10-14
The key economic mile marker this week is the Consumer Price Index report on Wednesday, Feb. 12. Economists anticipate a 2.9% year-over-year increase, keeping inflation above the Federal Reserve’s 2% target. If inflation surprises to the downside, bond investors — who have largely abandoned hope for rate cuts in 2025—may see a clearer path ahead.
Beyond economic data, rapidly shifting political policies and directives continue to test investors’ ability to maneuver through changing conditions. We’re reminding clients that when it comes to market volatility, the last thing you want to do — once again borrowing a driving analogy — is overcorrect or slam the brakes at every headline. A disciplined approach and a well-structured financial plan remain the best tools to navigate your financial journey with confidence.
The information contained herein represents the views of Elevage Partners at a specific point in time and is based on information believed to be reliable. No representation or warranty is made concerning the accuracy of any data compiled herein In addition, there can be no guarantee that any projection, forecast, or opinion in these materials will be realized. Any statement non-factual in nature constitutes only current opinion which is subject to change. These materials are provided for informational purposes only and do not constitute investment advice. Any reference to a security listed herein does not constitute a recommendation to buy, sell, or hold such security. Past performance is no guarantee of future results. The historical returns of any securities and/or sectors mentioned in this commentary are not necessarily indicative of their future performance.