What Happened?
A number of stocks fell in the afternoon session after President Trump criticized the Federal Reserve's approach to interest rate cuts, warning that the pace was slow and could hinder economic growth. Trump's comments added pressure to an already sensitive market, raising concerns about political interference in monetary policy.
Meanwhile, Fed Chair Jerome Powell maintained a cautious stance the previous week, highlighting the difficulty of balancing the dual mandate of steady employment and price stability amid the escalating trade tension. Investor sentiment was further dampened by the absence of constructive progress in trade negotiations, especially US-China relations which took a turn for the worse in the previous week.
Overall, the outlook seemed more unclear heading into the first quarter 2025 earnings season, as a combination of hard to predict monetary policy and unresolved trade tensions weighed on business confidence.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, following stocks were impacted:
- Maintenance and Repair Distributors company WESCO (NYSE: WCC) fell 5.5%. Is now the time to buy WESCO? Access our full analysis report here, it’s free.
- Construction and Maintenance Services company Primoris (NYSE: PRIM) fell 5.3%. Is now the time to buy Primoris? Access our full analysis report here, it’s free.
- Marine Transportation company Matson (NYSE: MATX) fell 5.4%. Is now the time to buy Matson? Access our full analysis report here, it’s free.
- Aerospace company Rocket Lab (NASDAQ: RKLB) fell 5.7%. Is now the time to buy Rocket Lab? Access our full analysis report here, it’s free.
- Aerospace company Astronics (NASDAQ: ATRO) fell 5.1%. Is now the time to buy Astronics? Access our full analysis report here, it’s free.
Zooming In On Rocket Lab (RKLB)
Rocket Lab’s shares are extremely volatile and have had 65 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 6 days ago when the stock gained 13.1% on the news that the company announced it was selected to provide hypersonic test launch capabilities through its HASTE launch vehicle, along with other related services, under two multi-billion-dollar government development programs for the United States and the United Kingdom.
The first contract, with the U.S. Air Force, fell under the $46 billion Enterprise-Wide Agile Acquisition Contract (EWAAC), and was designed to bolster the Air Force's capabilities.
The second contract was with the United Kingdom's Ministry of Defence (UK MOD) for its Hypersonic Technologies & Capability Development Framework (HTCDF), a roughly $1.3 billion (£1 billion) initiative to advance the UK's hypersonic capabilities.
The company's inclusion in both U.S. and UK programs reflected growing demand for its launch technologies and services, and could drive long-term revenue growth while elevating its status as a trusted defense partner.
Rocket Lab is down 25.8% since the beginning of the year, and at $18.52 per share, it is trading 41.3% below its 52-week high of $31.57 from January 2025.
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