---
title: "U.S. Stock Outlook | The Federal Reserve's Favorite Recession Indicator Turns \"Red\" Again"
type: "News"
locale: "en"
url: "https://longbridge.com/en/news/229904259.md"
description: "U.S. stock index futures are all up, with S&P 500 index futures rising by 0.66% and Nasdaq futures up by 0.67%. However, the Federal Reserve's favorite recession indicator shows an increased risk of economic recession, as the yield on 10-year U.S. Treasury bonds is lower than that on 3-month U.S. Treasury bonds, resulting in an inverted yield curve, indicating a higher likelihood of economic recession within the next 12 months. Market confidence in the U.S. economic outlook has weakened, and Trump's policies have failed to boost investor confidence"
datetime: "2025-02-27T11:41:03.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/229904259.md)
  - [en](https://longbridge.com/en/news/229904259.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/229904259.md)
---

> Supported Languages: [简体中文](https://longbridge.com/zh-CN/news/229904259.md) | [繁體中文](https://longbridge.com/zh-HK/news/229904259.md)


# U.S. Stock Outlook | The Federal Reserve's Favorite Recession Indicator Turns "Red" Again

1.  On February 27th (Thursday) before the US stock market opened, the three major US stock index futures all rose. As of the time of writing, Dow futures were up 0.33%, S&P 500 futures were up 0.66%, and Nasdaq futures were up 0.67%.

![image.png](https://pub.pbkrs.com/uploads/2025/ebf4efe04e636435898dec9769736eb5?x-oss-process=style/lg)

1.  As of the time of writing, the German DAX index was down 0.65%, the UK FTSE 100 index was up 0.41%, the French CAC 40 index was down 0.11%, and the Euro Stoxx 50 index was down 0.59%.

![image.png](https://pub.pbkrs.com/uploads/2025/c58733c548a65fe9fe5152fbfc949197?x-oss-process=style/lg)

1.  As of the time of writing, WTI crude oil was up 1.12%, priced at $69.39 per barrel. Brent crude oil was up 1.12%, priced at $72.88 per barrel.

![image.png](https://pub.pbkrs.com/uploads/2025/2b5e1bd65c46aa2b209f0724639db439?x-oss-process=style/lg)

## Market News

**The Federal Reserve's favorite recession indicator is flashing again! Is the US economy "flashing red"?** A typical recession warning signal is flashing in the US Treasury market—the yield on the 10-year US Treasury bond is lower than the yield on the 3-month US Treasury bond, known as an inverted yield curve. Over the past few decades, this warning signal has had a reliable record in predicting economic recessions (12-18 months after the signal appears). In fact, the New York Fed considers this a very reliable indicator, updating this relationship monthly and providing the probability of an economic recession occurring within the next 12 months. At the end of January, when the yield on the 10-year US Treasury bond was about 0.31 percentage points higher than that of the 3-month US Treasury bond, the New York Fed's model indicated that the probability of a US economic recession in the next 12 months was only 23%. However, as the yield on the 10-year US Treasury bond inverted with that of the 3-month US Treasury bond, the likelihood of a recession has indeed increased.

**US stocks and the dollar both cool down, is the "American exceptionalism" halo fading?** At the beginning of this year, investors generally bet that President Trump's policies would help the US stock market and the dollar stand out in the global market. However, this expectation seems to be facing increasing challenges. Trump's reforms and large-scale initiatives in trade and other policies have not only failed to instill confidence in investors but have also injected uncertainty, and both consumers and businesses are worried about the economic outlook, threatening the narrative of American exceptionalism. Additionally, the large US technology and growth companies that have driven most of the market's gains in recent years are struggling due to concerns over valuations and the low-cost AI model DeepSeek from China **Federal Reserve's Bostic: Interest rates need to remain in a restrictive range to curb inflation.** Raphael Bostic, President of the Atlanta Federal Reserve Bank, stated that the Federal Reserve should maintain current interest rates to continue applying downward pressure on inflation. Bostic said at a housing conference in Atlanta on Wednesday, "We need to maintain the status quo." He also added, "You could say we are achieving our employment goals, and now we must control our price stability goals. We need to maintain a restrictive policy stance." Last month, policymakers kept interest rates unchanged to allow more time to observe further developments in inflation and to gain a deeper understanding of how former President Donald Trump's policies might impact the economy. The Federal Reserve's benchmark interest rate is currently in the target range of 4.25% to 4.5%, down a full percentage point from last September.

**Trump cancels Chevron's operating license in Venezuela, oil prices rise for the first time in three days.** On Thursday, oil prices rose for the first time in three days after U.S. President Donald Trump announced the revocation of Chevron's (CVX.US) operating license in Venezuela, reigniting supply concerns. A day earlier, contracts closed at their lowest level since December 10 due to an unexpected increase in U.S. fuel inventories, indicating weak demand, and hopes for a potential peace agreement between Russia and Ukraine. So far this month, both oil price benchmarks have fallen by about 5%. Trump stated on Wednesday that he would revoke the license granted to Chevron to operate in Venezuela more than two years ago by former President Biden. Chevron's operations in Venezuela export about 240,000 barrels of crude oil daily, accounting for more than a quarter of the country's total oil production. The termination of the license means Chevron will no longer be able to export Venezuelan crude oil.

**"Trump trade" completely fizzles! Bitcoin spot ETF loses over $1 billion in a single day! Next stop 70,000?** Investors withdrew over $1 billion from U.S. spot Bitcoin exchange-traded funds (ETFs) on Tuesday, marking the largest single-day outflow since these funds debuted in January last year. The weakening demand for ETFs further exacerbated Bitcoin's decline. According to data compiled by Bloomberg, the Fidelity Wise Origin Bitcoin Fund (FBTC) saw the largest outflow, followed by the iShares Bitcoin Trust ETF (IBIT). Meanwhile, Bitcoin's price has been falling as investors avoid higher-risk assets amid uncertainty. Overall, Bitcoin funds have seen outflows of about $2.1 billion over the past six days, marking the longest outflow period since June last year.

## Individual Stock News

**Daqo New Energy (DQ.US) Q4 revenue declines 59.0% year-on-year, net loss of $180.2 million.** Daqo New Energy reported Q4 revenue of $195.4 million, a year-on-year decline of 59.0%; the net loss attributable to shareholders was $180.2 million, with a loss of $2.71 per ADS. The adjusted net loss attributable to shareholders was $170.7 million, with a loss of $2.56 per ADS. The decline in revenue compared to the third quarter of 2024 was mainly due to a decrease in average selling prices, although an increase in sales mitigated this impact In the fourth quarter, the production of polysilicon was 34,236 tons, down from 43,592 tons in the previous quarter; sales were 42,191 tons, slightly up from 42,101 tons in the previous quarter. Looking ahead, the company expects to produce approximately 25,000 to 28,000 tons of polysilicon in the first quarter of 2025. It is anticipated that the total production for the year 2025 will be around 110,000 to 140,000 tons of polysilicon, including the impact of the company's annual facility maintenance.

**NVIDIA (NVDA.US) financial report withstands "computing power doubts," AI spending boom remains.** NVIDIA's Q4 revenue grew 78% year-on-year to $39.331 billion, exceeding analysts' expectations of $38.05 billion; among this, data center revenue was $35.58 billion, a year-on-year increase of 93.32%. Q4 net profit was $22.066 billion, up 72% year-on-year, corresponding to earnings per share of $0.89, compared to analysts' expectations of $0.84. The sales in the most recent quarter surpassed NVIDIA's annual revenue two years ago, when NVIDIA's total annual revenue was $27 billion, highlighting the rapid growth of the company. In fiscal year 2025, NVIDIA achieved total revenue of $130.497 billion, a year-on-year increase of 114%; net profit reached $72.880 billion, a year-on-year increase of 145%. The data center division is NVIDIA's largest source of revenue to date, with sales of $35.6 billion, exceeding the average expectation of $34.1 billion.

**Salesforce (CRM.US) Q4 revenue and guidance disappointing, intensified competition in AI agents raises concerns.** Salesforce's Q4 revenue grew 7.6% year-on-year to $9.99 billion, falling short of market expectations; adjusted earnings per share were $2.78, better than the market expectation of $2.61. This software company has achieved single-digit revenue growth for the third consecutive quarter, whereas it has historically maintained a faster growth rate. Looking ahead, Salesforce expects revenue for the fiscal year 2026, ending January 2026, to reach $40.5 billion to $40.9 billion, with analysts' average expectation at $41.5 billion. The company anticipates an adjusted operating profit margin of approximately 34%, while analysts' average expectation is 33.9%.

**Synopsys (SNPS.US) Q1 performance exceeds expectations, maintains performance guidance with slight stock price increase.** In the fiscal quarter ending January 31, Synopsys reported adjusted earnings per share of $3.03, exceeding analysts' expectations of $2.79. Although revenue decreased 12% year-on-year, it still reached $1.46 billion, surpassing analysts' expectations of $1.45 billion. Among this, revenue from design automation business grew slightly by 3.5% to $1.02 billion; while revenue from design intellectual property (IP) business decreased by 17% to $435.1 million. Looking ahead, Synopsys expects adjusted earnings per share in the second quarter to be between $3.37 and $3.42, with revenue expected to be between $1.59 billion and $1.62 billion. Analysts had previously expected adjusted earnings per share of $3.39 and revenue of $1.6 billion.

**Snowflake (SNOW.US) Q4 performance exceeds expectations, strong sales outlook drives growth.** Data warehouse giant Snowflake's revenue growth outlook for this fiscal year is better than expected, and it has issued an optimistic signal regarding the adoption of its recently launched AI products, causing the stock to surge in after-hours trading Data shows that the company's Q4 revenue grew by 27.4% to $986.77 million, exceeding analysts' expectations of $956.89 million, with an adjusted earnings per share of $0.30, surpassing the consensus estimate of $0.18 per share. In the fourth fiscal quarter, product revenue increased by 28% to $943.3 million, while the average analyst expectation was $915.8 million. Snowflake currently has 580 customers who spent over $1 million in the past 12 months, up from 542 in the previous quarter. For the quarter ending January 31, the remaining performance obligations (another key growth benchmark) stood at $6.9 billion, exceeding the average expectation of approximately $6.67 billion.

**eBay (EBAY.US) Q4 performance exceeded expectations, but bleak sales outlook led to a sharp decline in stock price.** eBay's Q4 revenue was $2.6 billion, with earnings per share of $1.25, both exceeding market expectations. In the fourth quarter, eBay's gross merchandise volume (GMV) grew by 4% to $19.3 billion, surpassing the market expectation of $19.1 billion. By the end of 2024, eBay's active buyer count reached 134 million, also exceeding market expectations. However, the strong performance during the holiday season was overshadowed by a bleak outlook. eBay expects current quarter revenue to fall below analysts' expectations, with CEO Jamie Iannone attributing this to weak demand in Germany and the UK. eBay forecasts Q1 2025 revenue to be between $2.52 billion and $2.56 billion, with adjusted earnings per share of $1.32 to $1.36. In contrast, analysts' average expectations are for revenue of $2.6 billion and earnings per share of $1.33.

**Instacart's parent company Maplebear (CART.US) Q4 revenue and Q1 profit guidance both fell short of expectations.** Instacart's Q4 revenue grew by 10% year-over-year to $883 million, but was below the average analyst expectation of $891 million. Under GAAP accounting standards, net profit was $148 million, an increase of $13 million from the same period last year; adjusted EBITDA was $252 million, a year-over-year increase of 27%. The gross transaction value, which measures the value of products sold, was $8.645 billion, up 10% year-over-year. Meanwhile, the company expects adjusted EBITDA for Q1 2025 to be between $220 million and $230 million, with the midpoint falling short of the average analyst expectation of $237.1 million; it anticipates total transaction value for Q1 to be between $9 billion and $9.15 billion, while analysts' average expectation is $9 billion.

**Amazon (AMZN.US) Alexa voice assistant receives a major upgrade, embedding generative AI.** Amazon announced on Wednesday its first major improvement to the Alexa voice assistant since its launch over a decade ago, embedding it with generative artificial intelligence. Since launching Alexa in 2014, Amazon has invested billions of dollars into it, hoping to expand the service across a range of devices and ultimately drive sales on its main e-commerce site Amazon's device and services chief, Panos Panay, stated that this new service is called Alexa+, echoing the premium names of many high-tech and streaming service products.

## Important Economic Data and Event Forecast

Beijing time 21:30: U.S. January durable goods orders month-on-month preliminary value (%), U.S. fourth quarter real GDP annualized quarter-on-quarter revision (%), U.S. initial jobless claims for the week ending February 22 (10,000).

Beijing time 23:00: U.S. January seasonally adjusted existing home sales index month-on-month (%).

Beijing time 23:30: U.S. EIA natural gas inventory change for the week ending February 21 (billion cubic feet).

Next day Beijing time 00:00: U.S. February Kansas City Fed manufacturing composite index.

Beijing time 21:15: 2027 FOMC voting member, Richmond Fed President Barkin speaks on inflation.

Beijing time 22:15: 2025 FOMC voting member, Kansas City Fed President George speaks on economic issues.

Beijing time 23:00: Federal Reserve Governor Barr speaks on "new activity regulation."

Next day Beijing time 00:45: Federal Reserve Governor Bowman speaks on "community banks."

Next day Beijing time 02:15: Cleveland Fed President Mester speaks.

Next day Beijing time 04:15: 2026 FOMC voting member, Philadelphia Fed President Harker speaks on economic outlook.

## Earnings Forecast

Friday morning: Dell (DELL.US), HP (HPQ.US)

### Related Stocks

- [Chevron Corporation (CVX.US)](https://longbridge.com/en/quote/CVX.US.md)
- [HP Inc. (HPQ.US)](https://longbridge.com/en/quote/HPQ.US.md)
- [Synopsys, Inc. (SNPS.US)](https://longbridge.com/en/quote/SNPS.US.md)
- [Daqo New Energy Corp. (DQ.US)](https://longbridge.com/en/quote/DQ.US.md)
- [Salesforce, Inc. (CRM.US)](https://longbridge.com/en/quote/CRM.US.md)
- [eBay Inc. (EBAY.US)](https://longbridge.com/en/quote/EBAY.US.md)
- [Snowflake Inc. (SNOW.US)](https://longbridge.com/en/quote/SNOW.US.md)
- [GraniteShares 2x Long NVDA Daily ETF (NVDL.US)](https://longbridge.com/en/quote/NVDL.US.md)
- [Instacart（Maplebear） (CART.US)](https://longbridge.com/en/quote/CART.US.md)
- [Dell Technologies Inc. (DELL.US)](https://longbridge.com/en/quote/DELL.US.md)
- [iShares Bitcoin Trust ETF (IBIT.US)](https://longbridge.com/en/quote/IBIT.US.md)
- [Amazon.com, Inc. (AMZN.US)](https://longbridge.com/en/quote/AMZN.US.md)
- [YieldMax NVDA Option Income Strategy ETF (NVDY.US)](https://longbridge.com/en/quote/NVDY.US.md)
- [NVIDIA Corporation (NVDA.US)](https://longbridge.com/en/quote/NVDA.US.md)

## Related News & Research

- [How devastating Anthropic’s leak exposed 512,000 lines of Claude Code](https://longbridge.com/en/news/281215116.md)
- [Gold Hunter shifts from quiet buildup to fully funded drilling push at Newfoundland gold district](https://longbridge.com/en/news/281261616.md)
- [Warren Buffett teams up with NBA superstar Stephen Curry for charity lunch, reviving iconic auction](https://longbridge.com/en/news/281182480.md)
- [How JPMorgan's plan to revive the American dream by going smaller would also help itself](https://longbridge.com/en/news/281225965.md)
- [04:00 ETM&A Source® Announces the 2026 Spring Conference & Deal Market](https://longbridge.com/en/news/281147895.md)