Monthly Observations - March 2025

By Chris Zaccarelli

Monthly Observations

The S&P 500 fell -1.3% in February, giving back most of January's gains. The MSCI All Country World index rose 0.7% in February, boosted by strong performance from European markets, improving its year-to-date return to 4.5%. The Bloomberg BarCap U.S. Aggregate Bond index rose 2.2% during February, giving it a year-to-date gain of 2.2%.

The stock market fell in February as uncertainty around tariffs began to weigh on investor sentiment. The tariff situation is creating uncertainty because the new administration is using tariffs as a negotiating tool, which means the situation is fluid and hard to predict. European stocks outperformed US stocks in February, which is unusual, but reflects the fact that European stocks are cheaper and have been benefiting from optimism around a potential peace deal in Ukraine.

Monthly Highlights

The tariff situation is creating uncertainty and beginning to weigh on markets

European stocks are outperforming US stocks for the first time in years

The president met with Zelensky in an Oval Office meeting that went badly

News in Review

Below are some stories that caught our eye this past month. To learn more, follow the links to the full article.

Tariff Turmoil: Markets Wobble as Trade War Fears Mount

The Trump administration imposed tariffs on Canada, Mexico and China in February, though they quickly issued temporary exemptions on many goods. The tariff situation is hard to track because the administration is using tariffs as a negotiating tool, which means they are being imposed, suspended, modified and re-imposed on a regular basis, creating uncertainty for businesses and investors alike.

European Stocks Outperform US for First Time in Years

European stocks have been outperforming US stocks so far this year, which is a reversal of the trend from recent years. European stocks are cheaper than US stocks on a valuation basis, and investors are optimistic about a potential peace deal in Ukraine, which would be beneficial for European economies that have been hurt by the war.

Oval Office Meeting Between Trump and Zelensky Goes Poorly

Ukrainian President Zelensky visited the White House and had a contentious meeting with President Trump and Vice President Vance in the Oval Office. The meeting did not go well, with Trump and Vance criticizing Zelensky for not being more grateful for US support and for not being willing to make concessions to end the war. The meeting ended with Zelensky leaving without signing a minerals deal that had been under negotiation.

Scientists Discover That Dolphins Have Names for Each Other

Scientists have discovered that dolphins use unique whistles to refer to other dolphins, essentially giving each other names. This is one of the very few examples of animals using arbitrary sounds to refer to specific individuals, a behavior previously thought to be unique to humans. The research is providing new insights into dolphin communication and social behavior.

DISCLOSURES

Securities offered through LPL Financial, Member FINRA/SIPC. Blackbridge Financial is another business name of Independent Advisor Alliance, LLC. All investment advice is offered through Independent Advisor Alliance, LLC, a registered investment adviser. Independent Advisor Alliance, LLC is a separate entity from LPL Financial. The opinions expressed in this material do not necessarily reflect the views of LPL Financial.

This newsletter was written and produced by the Independent Advisor Alliance, LLC. Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly. The views stated in this letter should not be construed directly or indirectly as an offer to buy or sell any securities mentioned herein. Due to volatility within the markets mentioned, opinions are subject to change without notice. Information is based on sources believed to be reliable; however, their accuracy or completeness cannot be guaranteed. Past performance does not guarantee future results.

S&P 500 INDEX: The Standard & Poor's 500 Index is an unmanaged, capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.

NASDAQ 100 INDEX: The Nasdaq 100 Index is an unmanaged, capitalization-weighted index of the largest 100 non-financial stocks traded on the Nasdaq market. Unlike the S&P 500 it does not represent all major industries and may be more volatile than more broadly constructed indices.

MSCI ACWI INDEX: The MSCI ACWI captures large- and mid-cap representation across 23 developed markets (DM) and 24 emerging markets (EM) countries. With 2,495 constituents, the index covers approximately 85% of the global investable equity opportunity set.

Bloomberg U.S. Aggregate Bond Index: The Bloomberg U.S. Aggregate Bond Index is a broad-based index of the U.S. investment-grade, fixed-rate bond market, including both government-related and corporate securities and mortgage-backed and asset-backed securities.

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