February was a bumpy month for the overall stock market and our stocks.
Distractions like Trump 2.0’s latest tariff threats, the German elections, DeepSeek’s AI claims, weak consumer confidence and elevated inflation caused some wild market swings. As a result, all of the major indices ended the month of February lower, with the S&P 500 down 1.4%, the Dow down 1.6% and the NASDAQ down nearly 4%.
March has gotten off on equally volatile footing. Yesterday, markets began to sell off as deadlines approached for President Trump’s threatened tariffs against Canada and Mexico. As a result, the S&P fell 1.7% on Monday to post its worst day of the year. Meanwhile, the Dow lost 1.5% and the tech-heavy NASDAQ dropped 2.6%.
The stock market threw another hissy fit over tariffs today, with all of the major indices opening sharply lower this morning. At one point, they were all down by more than 1% before moderating those losses in afternoon trading. As investors digested the tariff news, they began to worry about how they will impact the U.S. economy now that they are in place.
So, in today’s Market 360, let’s review the latest tariff news. I’ll explain why we shouldn’t worry and what we need to remember during market selloffs. Simply put, good stocks will bounce. I’ll share an example of one such stock… and why quantum computing should serve as a catalyst for it in the future.
The Continued Tariff Drama
President Trump placed 25% tariffs on Canada and Mexico and doubled the existing tariff on China to 20% at midnight on Tuesday. Canada responded this morning with a package of tariffs on $107 billion worth of goods. China responded by announcing additional tariffs of up to 15% on imports of U.S. farm products such as poultry, chicken and beef. Mexico is expected to respond soon as well.
Clearly, there’s a lot of anxiety over tariffs, but I want to assure you that I do not expect most tariffs to be inflationary. As an example, the tariffs that have been imposed on China are expected to be suppressed by Chinese deflation as well as a weak Chinese yuan. The Canadian and Mexican tariffs are expected to be a bit more painful.
So, as the retaliatory “tit for tat” tariffs are now underway, it will be up to Commerce Secretary Howard Lutnick to negotiate new trade deals if he believes they need to be modified. However, Lutnick is a big fan of tariffs reducing the income tax, so I do not expect any immediate changes.
But what we need to remember during market selloffs is that good stocks always bounce back like fresh tennis balls.
NVIDIA Bounces Back
Case in point: NVIDIA Corporation (NVDA).
As you may recall, NVIDIA stock took it on the chin after reported its fourth quarter and fiscal year 2025 last Wednesday. Despite record results, Wall Street was unhappy with the AI chip maker’s margins, which came in at 73% – down from 76% the previous year. The company also forecasted margins of 71% for the current quarter. (For my full review of NVIDIA’s earnings, click here.)
Following the news, the stock fell 8% on Thursday. It bounced back on Friday, but fell again on Monday. NVDA opened nearly 3% lower today, but then staged a big turnaround – ending the day up almost 2%. That’s pretty impressive considering that the NASDAQ was down as much as 2.1% today before recouping some of those losses in the afternoon. The index closed out the day down 0.3%.
The reality is NVIDIA continues to boast strong fundamentals. Fourth-quarter revenue soared 78% year-over-year to $39.3 billion, topping estimates for $38.16 billion. Fourth-quarter data center revenue accounted for $35.6 billion, which was up 93% from the same quarter a year ago. Fourth-quarter earnings jumped 71% year-over-year to $0.89 per share, which also beat estimates for $0.85 per share.
For its fiscal year 2025, NVIDIA reported revenue of $130.5 billion, or 114% annual revenue growth, and earnings of $2.99 per share, or 130% annual earnings growth. These results also bested analysts’ estimates for full-year revenue of $129.28 billion and earnings of $2.95 per share.
Also notable, NVIDIA revealed that the new Blackwell chip accounted for $11.0 billion in the fourth quarter, or 28% of NVIDIA’s revenue.
So, when the stock opened lower today, investors were quick to jump in and buy the dip, as it had previously hit lows not seen since September 2024. (For my full review of NVIDIA’s blowout earnings, go here.)
Now, as I’ve mentioned previously, I plan on holding NVIDIA in our Growth Investor portfolio through the end of the decade – and that’s because I continue to expect big things from NVIDIA, especially in the quantum computing space.
The reality is innovation never stops – and quantum computing is quickly becoming the next big investing opportunity. Just five days ago, Amazon.com, Inc. (AMZN) unveiled Ocelot, its first quantum computing chip, joining Microsoft Corporation (MSFT) and Alphabet Inc. (GOOG) in a race to dominate this emerging tech frontier.
And if history has taught us anything, it’s that those who get in early often see the biggest gains.
However, I know quantum computing is complex, and understanding its impact on the market can be challenging. That’s why my team and I are putting together a special series on quantum investing, launching later this week.
In the meantime, we want to hear from you! Send us your biggest questions about quantum computing, and I’ll answer them in upcoming Market 360 articles. You can reach us at Feedback@InvestorPlace.com and use the subject line “Quantum computing questions” so that I can be sure to see each one of them.
Sincerely,
Louis Navellier
Editor, Market 360
The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:
NVIDIA Corporation (NVDA)
