Schwab Market Update

Triple Witching Friday Could Result in Volatility

March 21, 2025 Joe Mazzola
Trillions of dollars of options contracts expire on Friday, which could lead to higher market volatility. Some commodities are becoming trade war casualties.

Published as of: March 20, 2025, 9:15 a.m. ET

Listen to this article

Listen here or subscribe for free to the Schwab Market Update in your favorite podcast app.

The markets Last price Change % change
S&P 500® index

5,662.89

-12.40

-0.22%

Dow Jones Industrial Average®

41,953.32

-11.31

-0.03%

Nasdaq Composite®

17,691.63

-59.16

-0.33%

10-year Treasury yield

4.21%

-.25

--
U.S. Dollar Index

103.88

+0.03

+0.03%

Cboe Volatility Index® 20.40
+0.60

+3.03%

WTI Crude Oil

$68.05

-$0.02

-0.02%

Bitcoin

$83,930

-265

-0.31%

(Friday market open) Equity index futures were pointing to a lower opening, with S&P 500 futures 0.21% lower on Friday's premarket session. On the bright side, the CBOE Volatility Index (VIX) has retraced from its recent high around 25 to just below 20, suggesting investor anxiety has waned. However, the VIX is still elevated for the year, suggesting some hesitancy.  

On a triple witching expiration Friday, investors should be prepared the possibility of increased volatility, especially around today’s close. With the closing of $4.5 trillion of equity, index, and ETF options, traders have a lot of positions to unwind or roll.

U.S. cotton has been a casualty of the trade war as Chinese purchases fell almost 80% from a year ago according to Bloomberg. Large engine cars were down 70% and crude oil and natural gas purchases are down 40%. However, soybean imports have risen 50% and purchases of processors and chips has nearly doubled.

To get the Schwab Market Update in your inbox every morning, subscribe on Schwab.com.

Three things to watch

  1. Harboring: The bond market saw some flow of funds as investors looked for safe havens on Thursday. Yesterday's bond rally was likely due to the follow-on effects from Wednesday's Fed meeting and caution from the Bank of England, according to Cooper Howard, director, fixed income strategy at the Schwab Center for Financial Research. Howard expressed concern that the Fed lacked "confidence in their outlook and the situation could change rapidly." If uncertainty continues to rise, then bonds could see more buying.
     
  2. Base line: Light sweet crude oil futures (/CL) are dancing on a price level that's been around for about four years. Since October of 2021, the $66.50 level has acted as support for crude oil. If this level was to break, investors could see it as a bad sign for the economy because demand for oil is low. Oil is a useful economic indicator because it's used in the transportation, manufacturing, and base of many products.
     
  3. Wall Street woes: Layoffs are coming to Wall Street: Morgan Stanley (MS), Goldman Sachs (GS), and Bank of America (BAC) all announced layoffs in the last few weeks, according to Yahoo! Finance. Many of these financial institutions have experienced recent pullbacks in line with the market, but none of them appear to be in financial straits. So far, it appears the move is an attempt to follow Citigroup (C) and get leaner. Citi announced a two-year reduction plan a year ago.

On the move

  • In an all hands meeting broadcast, Elon Musk encouraged Tesla (TSLA) employees to be patient as the company goes through some tough times. Tesla stock has dropped 50% in three months.
     
  • Micron (MU) was down 3.51% ahead of the opening bell despite posting better-than-expected earnings and revenue after yesterday’s close.
     
  • FedEx (FDX) tumbled 3.9% after yesterday’s closing bell when it reported lower-than-expected earnings despite topping revenue estimates. Losses were compounded overnight to 7.92% ahead of the opening bell.
     
  • Nike (NKE) beat earnings and revenue estimates resulting in the stock rallying 4.23% in extended hours trading. However, overnight, investors flipped on the stock, taking it down 4% from its Thursday close.

More insights from Schwab

Managing governance: Corporate governance can impact a company's performance. Learn why corporate governance matters to retail investors and the three groups that direct it: shareholders, the board of directors, and management by watching Schwab's "Corporate Governance: Who Controls Public Companies" video.

Stock Who's in Control?

Managing governance: Corporate governance can impact a company's performance. Learn why corporate governance matters to retail investors and the three groups that direct it: shareholders, the board of directors, and management by watching Schwab's "Corporate Governance: Who Controls Public Companies" video.

" role="dialog" aria-label="

Managing governance: Corporate governance can impact a company's performance. Learn why corporate governance matters to retail investors and the three groups that direct it: shareholders, the board of directors, and management by watching Schwab's "Corporate Governance: Who Controls Public Companies" video.

" id="body_disclosure--media_disclosure--111271" >

Managing governance: Corporate governance can impact a company's performance. Learn why corporate governance matters to retail investors and the three groups that direct it: shareholders, the board of directors, and management by watching Schwab's "Corporate Governance: Who Controls Public Companies" video.

Chart of the day

Five year chart comparing rise in S&P 500's growth index from about 1,500 to 3,800 to the value index's rise from about 950 to 1,880. A relative strength indicator comparing the two shows a rise from about 1.6 to 2.2, then a recent drawback to 2.

Data sources: S&P Global. Chart source: thinkorswim® platform.

Past performance does not guarantee future results.
For illustrative purposes only.

Comparing the S&P 500 Value Index ($SP500V) to the S&P 500 Growth Index ($SP500G) using the relative strength indicator shows that investor appear to be favoring value during the recent decline in the markets. However, the growth index has overall been stronger than the value index going back to January of 2023, which may suggest that growth could still have the secular advantage because the uptrend remains intact.

The week ahead

Check out the Investors' Calendar for a summary of the top economic events and earnings reports on tap this week.

March 24: Expected earnings from KB Home (KBH).
March 25: March Consumer Confidence, February new home sales, and expected earnings from McCormick (MKC).
March 26: February durable goods and expected earnings from Chewy (CHW), Petco (WOOF), and Dollar Tree (DLTR).
March 27: Final Q4 gross domestic product, wholesale inventories, pending home sales, and expected earnings from Walgreens Boots Alliance (WBA), AAR (AIR), and Winnebago (WGO).
March 28: PCE price index and Michigan consumer sentiment.

The information provided here is for general informational purposes only and should not be considered an individualized recommendation or personalized investment advice. The investment strategies mentioned here may not be suitable for everyone. Each investor needs to review an investment strategy for his or her own particular situation before making any investment decision. 

All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third-party providers is obtained from what are considered reliable sources. However, its accuracy, completeness, or reliability cannot be guaranteed. 

Examples provided are for illustrative purposes only and not intended to be reflective of results you can expect to achieve. 

Schwab Center for Financial Research ("SCFR") is a division of Charles Schwab & Co., Inc.

Supporting documentation for any claims or statistical information is available upon request.

Past performance is no guarantee of future results, and the opinions presented cannot be viewed as an indicator of future performance.

Investing involves risk, including loss of principal. 

Diversification strategies do not ensure a profit and do not protect against losses in declining markets. 

Indexes are unmanaged, do not incur management fees, costs, and expenses and cannot be invested in directly. For more information on indexes, please see schwab.com/indexdefinitions

The policy analysis provided by the Charles Schwab & Co., Inc., does not constitute and should not be interpreted as an endorsement of any political party.

Fixed income securities are subject to increased loss of principal during periods of rising interest rates. Fixed-income investments are subject to various other risks including changes in credit quality, market valuations, liquidity, prepayments, early redemption, corporate events, tax ramifications, and other factors.

Digital currencies [such as bitcoin] are highly volatile and not backed by any central bank or government. Digital currencies lack many of the regulations and consumer protections that legal-tender currencies and regulated securities have. Due to the high level of risk, investors should view digital currencies as a purely speculative instrument.

Cryptocurrency-related products carry a substantial level of risk and are not suitable for all investors. Investments in cryptocurrencies are relatively new, highly speculative, and may be subject to extreme price volatility, illiquidity, and increased risk of loss, including your entire investment in the fund. Spot markets on which cryptocurrencies trade are relatively new and largely unregulated, and therefore, may be more exposed to fraud and security breaches than established, regulated exchanges for other financial assets or instruments. Some cryptocurrency-related products use futures contracts to attempt to duplicate the performance of an investment in cryptocurrency, which may result in unpredictable pricing, higher transaction costs, and performance that fails to track the price of the reference cryptocurrency as intended. Please read more about risks of trading cryptocurrency futures here.

Options carry a high level of risk and are not suitable for all investors. Certain requirements must be met to trade options through Schwab. Please read the Options Disclosure Document titled "Characteristics and Risks of Standardized Options" before considering any option transaction.

0325-0131