Stock Market Overview
Investors are back at their desks after last week’s market downturn, bracing for a packed economic calendar. This week brings updates on U.S. GDP, consumer confidence, and the housing market, along with another wave of corporate earnings, including Salesforce’s latest report.
Federal Employees Ordered to Justify Their Work
Government Workforce Under Scrutiny
Federal employees received an unexpected directive over the weekend, following an X post from Elon Musk. The billionaire, now a senior advisor to the Trump administration, announced that all government workers would receive an email requiring them to outline their accomplishments from the previous week. He added that failing to respond would be considered a resignation.
The U.S. Office of Personnel Management (OPM) followed up with an official email, instructing employees to submit five completed tasks by 11:59 PM ET on Monday. While the notice stopped short of threatening dismissal, it warned employees against including classified or legally protected information.
Resistance from Agencies and Unions
The directive has sparked immediate pushback. Some federal workers and department leaders argue that disclosing specific work details to OPM could violate security protocols and attorney-client privilege.
Union representatives were quick to respond, with the National Treasury Employees Union advising its members not to comply, arguing that federal employees do not report to OPM.
Mixed Responses Across Government
While some agencies pledged compliance, others hesitated:
- The Department of Defense and FBI instructed employees to pause their responses, stating they would conduct their own internal reviews.
- The State Department and Homeland Security said that managers would handle the review process on behalf of employees.
- Interim U.S. Attorney for Washington, D.C., Ed Martin, told staff they could choose whether to reply or not.
On Sunday, Musk doubled down, stating on X that many government employees are so disengaged they don’t even check their emails. With today’s deadline looming, legal challenges appear imminent.
Global Headlines
Pope Francis’ Health in Decline
Pope Francis, who turned 88 in December, remains in critical condition following complications from double pneumonia. The Vatican reported that the pontiff suffered a severe asthmatic crisis on Saturday and is now receiving oxygen therapy and platelet infusions.
The statement also confirmed that Francis is experiencing early-stage kidney failure, though the condition is currently being managed. Despite his health struggles, he was described as “alert and fully aware” and attended Mass in his hospital suite on Sunday.
Ukraine Demands Better Terms on Rare Minerals Agreement
At a press conference yesterday, Ukrainian President Volodymyr Zelensky pushed back against a proposed U.S. deal for access to Ukraine’s rare earth minerals. The agreement, which would grant American firms a stake in titanium, lithium, and other strategic resources, has drawn concern from Kyiv.
Zelensky stated that he would not agree to a deal that “future generations of Ukrainians would have to pay back”, calling for improved financial terms and security guarantees. He also clarified that the $100 billion in U.S. aid provided since the Russian invasion was in the form of grants, not loans, dismissing any obligation to “repay a debt.”
Conservative Victory in German Elections
Germany’s center-right Christian Democratic Union (CDU), led by Friedrich Merz, secured a 28.6% victory in Sunday’s election, positioning Merz as the likely next chancellor.
The CDU had aimed for 30% of the vote, but now faces the challenge of forming a coalition. Merz has already ruled out working with Alternative for Germany (AfD), which placed second. The CDU leader wants to form a two-party government and has set a goal of establishing his cabinet within eight weeks. His primary focus: revitalizing Germany’s economy.
Buffett Calls for Responsible Spending After Record Tax Payment
Berkshire Hathaway’s Annual Shareholder Letter
Warren Buffett, the world’s sixth-richest person, released his highly anticipated annual letter to shareholders on Saturday. In addition to discussing Berkshire Hathaway’s strong earnings performance, Buffett took the opportunity to send a message to President Donald Trump and Congress regarding the company’s record $26.8 billion tax payment.
Buffett urged policymakers to “spend it wisely”, emphasizing that tax revenue should support those who need it most. He wrote: “Take care of the many who, through no fault of their own, get the short straws in life. They deserve better.”
Berkshire’s Financial Position
- The company’s cash reserves have grown to $334.2 billion, as Buffett continues to sell more stock than he buys.
- Despite concerns over Berkshire’s large cash holdings, Buffett reassured investors that the company’s core assets remain in equities.
- Operating earnings rose 71% in Q4 and 27% for the full year, with over half of Berkshire’s 189 businesses reporting declining profits.
Buffett also acknowledged the upcoming leadership transition, stating that Vice Chairman Greg Abel, 62, will soon take over as CEO.
The Week Ahead
Nvidia’s Earnings to Test Tech Market Stability
Investors are bracing for Nvidia’s Q4 earnings report on Wednesday, which could determine whether tech stocks regain momentum after Wall Street’s worst trading day of 2025 last Friday.
Despite Nvidia losing $600 billion in market value after DeepSeek unveiled a lower-cost AI model, CEO Jensen Huang remains optimistic. Analysts expect the chipmaker’s revenue to rise 72% year-over-year, with guidance updates likely to influence broader market sentiment.
Inflation Data to be Released Friday
The Federal Reserve’s preferred inflation gauge, the Personal Consumption Expenditures (PCE) Price Index, will be released on Friday.
Consumer inflation expectations are at their highest levels since 1995, as Trump’s renewed tariff threats add uncertainty. A hot inflation reading could force the Fed to reassess its rate-cut timeline, potentially rattling markets.
The Academy Awards Take Center Stage
Hollywood’s biggest night arrives Sunday, with the 96th Academy Awards starting at 7 PM ET.
After a season filled with controversy, host Conan O’Brien will navigate the ceremony, as Emilia Pérez and Adrien Brody emerge as frontrunners for Best Picture and Best Actor.
Additional Developments
- Today marks three years since Russia’s full-scale invasion of Ukraine.
- UK Prime Minister Keir Starmer will meet with President Trump on Thursday to discuss Ukraine and trade policy.
- Ramadan begins on Friday, with millions worldwide preparing for the holy month.
- March begins Saturday, marking the final stretch of Q1.
- Party City will shutter its remaining stores by week’s end after filing for bankruptcy.
What Else Is Happening?
- A Pennsylvania police officer was killed and five others wounded in a hospital shooting.
- American Airlines diverted a New York–Delhi flight to Rome due to a bomb threat.
- Shōgun and A Complete Unknown won big at the Screen Actors Guild Awards.
- Sam Altman announced the birth of his son over the weekend.
