Headline: US Stocks Retreat Amid Inflation and Tariff Apprehensions
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US equities experienced a downturn on Friday as investors grappled with the potential impact of a proposed tariff plan by the Trump administration. Consumer sentiment regarding inflation surged, overshadowing a monthly job report that indicated the labor market's resilience.
The S&P 500 (^GSPC) shed nearly 1%, while the tech-driven Nasdaq Composite (^IXIC) dropped approximately 1.4%, marking their second consecutive week of losses. The Dow Jones Industrial Average (^DJI) also took a hit, declining by over 400 points (1%) for its worst daily performance in roughly four weeks.
President Donald Trump announced plans for reciprocal tariffs on American imports during a meeting with Prime Minister Shigeru Ishiba of Japan. Additionally, consumer sentiment in the US fell to its lowest level in seven months, amplifying concerns about Trump's tariff threats.
The University of Michigan survey revealed that Americans now anticipate an inflation rate of 4.3% over the next year, a full percentage point higher than the previous month. In response, the yield on the 10-year Treasury (^TNX) reached a session high of 4.5% following the sentiment update and the monthly jobs report.
The report indicated that the US economy added 143,000 jobs in January, falling short of economists' expectations but demonstrating signs of stability in the labor market. Unemployment marginally declined from 4.1% in December to 4.0%.
Amazon's (AMZN) stock fell by approximately 4% after the e-commerce giant projected underwhelming revenue growth. This news comes amidst a broader selloff for large-cap technology companies that have recently disappointed Wall Street with their financial outlooks.