US Stocks Turn Lower on Inflation Expectations, Cooler Jobs Report
The major US stock indices declined on Friday, erasing earlier gains, as investors weighed a jump in consumer inflation expectations and a weaker-than-expected jobs report.
Market Summary
* S&P 500 (^GSPC): -0.1%
* Nasdaq Composite (^IXIC): -0.5%
* Dow Jones Industrial Average (^DJI): -0.1%
Consumer Sentiment and Inflation
US consumer sentiment fell to a seven-month low, underscoring concerns about inflation. Inflation expectations surged, with Americans now anticipating a 4.3% inflation rate over the next year, up 1% from January.
Jobs Report
The US economy added 143,000 jobs in January, missing economist expectations but indicating resilience in the labor market. Unemployment ticked down to 4.0% from 4.1% in December.
Amazon Disappoints
Shares of Amazon (AMZN) plunged over 3% after the company reported disappointing revenue guidance. This follows similar setbacks from other AI-focused tech giants like Google (GOOG).
Interest Rate Outlook
The jobs report has heightened anticipation for another interest rate cut by the Federal Reserve. Investors remain vigilant for signs of market vulnerability amid President Trump's ongoing tariff push.
Mortgage Rates
Consumer expectations for higher mortgage rates are growing, according to a survey by Fannie Mae. This uncertainty stems from reduced expectations for rate cuts by the Fed and concerns about Trump's economic agenda.
European Stocks
European stocks wavered on Friday but were on track for weekly gains, buoyed by strong earnings from Novo Nordisk (NVO). However, the FTSE 100 in London declined slightly after the Bank of England's interest rate cut.