US Stocks Fall on Tariff and Inflation Concerns
US equities declined on Friday as investors reacted to the possibility of additional tariffs imposed by the Trump administration. Financial markets also digested a spike in consumer inflation expectations and a lackluster monthly jobs report.
The S&P 500 (^GSPC) dipped nearly 1%, with the tech-heavy Nasdaq Composite (^IXIC) sliding around 1.4%, marking its worst day since January and its second consecutive week of losses. The Dow Jones Industrial Average (^DJI) shed over 400 points, or almost 1%, recording its steepest daily drop in roughly four weeks.
At the White House, President Donald Trump announced plans to unveil a strategy for retaliatory tariffs on American imports. The comments were made during a meeting with Japanese Prime Minister Shigeru Ishiba, where Trump also hinted at the possibility of tariffs on Japan.
The major indices earlier fell into negative territory after US consumer sentiment plummeted to a seven-month low in early February, undershooting forecasts. Inflation expectations surged amid apprehensions about Trump's tariff threats.
A University of Michigan survey revealed that Americans anticipate an inflation rate of 4.3% in the coming year, a full percentage point higher than the previous month. Following the sentiment update and the monthly jobs report, the 10-year Treasury (^TNX) yield climbed to a session high of 4.5%.
The jobs report indicated that the US economy created 143,000 jobs in January, falling short of economist projections but still demonstrating resilience in the labor market. Unemployment dropped to 4.0% from 4.1% in December.
Meanwhile, Amazon (AMZN) shares tumbled 4% after the e-commerce behemoth, along with Google (GOOG) and other AI-focused tech giants, disappointed Wall Street with its revenue outlook.