Fed's Inflation Focus Sparks Market Volatility; Walmart, HSBC, Alibaba Shares Surge

On February 25, 2025, the S&P 500 Index fell 0.47%, the Dow Jones Industrial Average rose 0.37%, and the Nasdaq Composite Index dropped 1.35%. In news, the U.S. House committee announced plans to comprehensively assess the Federal Reserve's interest rate decision-making process, with a focus on controlling inflation. Additionally, the CEO of Bank of America forecasted that the Fed would not lower interest rates this year, potentially influencing market sentiment.

Based on the market performance, the Utilities sector, Technology industry, Non-Essential Consumer Goods sector, Energy sector, and Communication Services sector underperformed the S&P. The Healthcare sector, Essential Consumer Goods sector, Materials sector, Industrial sector, and Real Estate sector, however, bucked the trend and rose.

Walmart shares surged 4.29% on Tuesday, as the retail giant announced a $4.5 billion share repurchase program and a 13% increase in its dividend, the largest hike in over a decade. The company's stock price has been on an upward trajectory, boosted by strong earnings and a robust e-commerce presence. HSBC Holdings, the multinational banking and financial services holding company, saw its shares rise 3.72% on the day. The bank's stock received a boost from DBS, which reiterated a Buy rating on HSBC Holdings and increased its price target. The positive outlook reflects the bank's strong fundamentals and potential for growth in the global financial sector. Alibaba Group, the Chinese e-commerce behemoth, witnessed its shares climb 3.85% on Tuesday. The company's cloud revenue is expected to double over the next three years, driven by planned capital investments in cloud and AI infrastructure. This positive outlook, coupled with the company's strong e-commerce performance, has contributed to the stock's upward momentum.

Organovo Holdings surged 244.17% today, with analysts forecasting a 20% upside for its 12-month price target. ReTo Eco-Solutions also rose significantly, up 83.05%, although no specific positive news was found to directly impact the company. Connexa Sports and Chegg, however, experienced a decline in their stock prices, down 46.37% and 31.41% respectively. Chegg's weak Q4 results and lowered future revenue guidance raised concerns about its bankruptcy risk.

The U.S. House of Representatives has established a task force to broadly evaluate the Federal Reserve's interest rate decisions, particularly focusing on whether controlling inflation should take precedence over ensuring employment. Meanwhile, Federal Reserve official Barr highlights the importance of assessing financial stability risks. In corporate news, Apple CEO Tim Cook announced plans to increase the company's annual dividend and revealed Apple's intention to be the largest customer of TSMC's Arizona plant. Additionally, Apple is set to invest over $500 billion in the next four years to boost AI server production. Nvidia's H20 AI chip has seen a surge in orders from Chinese companies due to the rising demand for DeepSeek's low-cost AI models, with major tech firms like Tencent, Alibaba, and ByteDance significantly increasing their orders.