--- title: "As the situation in the Middle East intensifies, U.S. stocks enter a critical week: Retail giants' earnings reports will test American consumer strength, can non-farm payroll data calm the \"red light\" warning?" type: "News" locale: "en" url: "https://longbridge.com/en/news/277379634.md" description: "The situation in the Middle East is escalating, and investors are focusing on the upcoming February employment report and Broadcom's earnings report from the United States. The S&P 500 index fell 0.5% last week, while the Nasdaq Composite index dropped 0.9%. Geopolitical uncertainty has led to increased risk aversion, resulting in rising gold and silver prices, and international oil prices surged due to the US-Iran conflict. Wall Street expects new job additions to slow to 60,000, with market attention shifting towards energy and defense companies" datetime: "2026-03-02T00:36:01.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/277379634.md) - [en](https://longbridge.com/en/news/277379634.md) - [zh-HK](https://longbridge.com/zh-HK/news/277379634.md) --- > Supported Languages: [简体中文](https://longbridge.com/zh-CN/news/277379634.md) | [繁體中文](https://longbridge.com/zh-HK/news/277379634.md) # As the situation in the Middle East intensifies, U.S. stocks enter a critical week: Retail giants' earnings reports will test American consumer strength, can non-farm payroll data calm the "red light" warning? The Zhitong Finance APP noted that the S&P 500 Index closed at 6,878.88 points last Friday, down about 0.5% for the week, but the benchmark index still maintains an increase of about 0.5% year-to-date. The technology-heavy Nasdaq Composite Index fell 0.9% last week and has dropped about 2.5% since 2026. Despite NVIDIA (NVDA.US) releasing explosive earnings on Wednesday, it failed to quell market concerns over the ongoing turbulence in artificial intelligence; meanwhile, a new round of sell-offs related to private credit indicates that the financial sector is still under significant pressure. **Highlights for the Coming Week** In the economic data calendar for the coming week, the February employment report to be released on Friday will be the main event. Additionally, the key earnings report from chipmaker Broadcom (AVGO.US) will also attract attention. Geopolitical uncertainty remains a focal point for investors, as the U.S. and Israel launched attacks on Iran over the weekend. Against the backdrop of expected declines in the aviation and other consumer sectors, the market's focus has shifted to energy and defense companies, viewing them as potential safe havens. Due to the escalation of the situation in the Middle East, risk aversion has increased, leading to a strong opening for gold and silver on Monday. Spot gold rose to $5,374 per ounce, up 1.8%; spot silver reported $96 per ounce, up 2.6%. International oil prices surged by $8 at the opening on Monday due to escalating U.S.-Iran conflicts, which have disrupted oil transportation. Brent crude reached a high of $82.37 per barrel, while WTI crude jumped to $80.82 per barrel. **Economic Data and Corporate Movements** The February employment report on Friday will be the focus. Wall Street economists expect the U.S. economy added 60,000 jobs last month, a slowdown compared to the 130,000 jobs added in January. The January report easily exceeded expectations, largely alleviating concerns about an imminent slowdown in the U.S. economy. Investors will also receive manufacturing data from S&P Global and the Institute for Supply Management (ISM) on Monday, as well as ADP employment data on Wednesday and weekly initial jobless claims on Thursday. In the corporate sector, investor attention will be split between "AI trades" and the state of U.S. consumer spending. On Wednesday, following disappointing earnings from NVIDIA, Broadcom will provide another window to observe AI demand. On Thursday, Marvell (MRVL.US) will also release its earnings report. In the retail sector, Target (TGT.US) on Tuesday and Costco (COST.US) on Thursday will lead the earnings week for big-box and grocery retailers, with other earnings reports including Ross Stores (ROST.US), Kroger (KR.US), BJ's Wholesale Club (BJ.US), and Macy's (M.US). **"Risks Rather Than Opportunities"** NVIDIA once again exceeded analysts' expectations for revenue and adjusted earnings on Wednesday. CEO Jensen Huang spoke extensively about the soaring demand for NVIDIA chips during the earnings call, and the company also raised its guidance But this is still not enough for investors. The day after the earnings report was released (Thursday), Nvidia's stock price fell by about 4.8%, and on Friday it dropped another 4%, with a total decline of over 6% for the week. Other stock markets also fell, with the three major indices closing down in trading on Thursday and Friday. Capital analyst Kyle Rodda wrote in a report to clients that the issue with Nvidia is that investor sentiment towards AI trading has changed overall. Rodda stated that while there are reasonable concerns about potential supply constraints, "the numbers for Nvidia's fourth quarter are flawless in every respect." Rodda wrote: "The signal here is that despite extraordinary performance, the market is undergoing an increasingly entrenched shift in sentiment and behavior. AI is being viewed as a risk rather than an opportunity, and in a market plagued by valuation and over-investment concerns, investors are more focused on avoiding losers rather than picking winners." Rodda's argument points directly to "AI panic trading." A report released by investment firm Citrini Research last Monday and Tuesday sparked widespread discussion, envisioning a future scenario where white-collar workers are massively replaced. The vulnerable stocks mentioned in the report subsequently plummeted—IBM experienced one of its worst single-day declines since 2000, and Zscaler (ZS.US) fell nearly 10% for the week. Bank of America strategists argued in a client report on Friday that the reality described in the Citrini report "is logically inconsistent and severely contradicts sound economic theory." If that's the case, why did it trigger a sell-off? Analysts wrote: "The answer lies in the combination of crowded positions and multiple equilibria, similar to a bank run triggered by unfounded bankruptcy rumors." **Is the labor market "flashing red"?** President Trump stated in his State of the Union address on Tuesday evening: "Today, there are more Americans working than at any time in our history." However, this dynamic does not necessarily reflect the current state of the labor market. When the U.S. Bureau of Labor Statistics (BLS) last released its monthly employment report, investors were greeted with an unexpectedly strong performance: 130,000 new jobs were added that month, double the consensus expectation of 65,000. BNP strategists wrote in a recent client report that the gap between the expected and actual values for January makes the February report crucial. Economists are again predicting that the U.S. economy will add 60,000 jobs. Strategists stated that if the February data performs strongly again, "such data could more decisively quell the rhetoric of 'the labor market is flashing red' and 'labor slack is about to accumulate rapidly.'" Although the headline figure of 130,000 new jobs in January seems optimistic, revisions to the 2025 data show that employers added an average of only 15,000 jobs per month last year. According to the BLS Job Openings and Labor Turnover Survey (JOLTS), job vacancies fell for the fourth consecutive month in December, while the overall vacancy situation remained relatively unchanged ADP Chief Economist Nela Richardson stated in an interview last Thursday: "The characteristics of this labor market are more sluggish than vibrant. It is very unusual to see employers exhibiting this level of caution." Any changes in the employment report and unemployment rate could influence interest rate policy based on the data results. This week's data will be the last batch of reference materials available to Federal Reserve officials before the "quiet period" begins ahead of the March 17-18 meeting. A strategist at Société Générale wrote: "A strong February report could lead the Federal Open Market Committee (FOMC) to reach a consensus to adjust the benchmark expectation for 2026 from 'one rate cut' to 'no rate cuts,' and it may even prompt board members to raise rates in 2026. However, the risks of a downturn may be underestimated." 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