US Stocks Suffer Worst Day of 2025 Amid Inflation Concerns
US stocks plummeted on Friday, marking their worst day of the year just two days after the S&P 500 reached a record high. Economic data releases stoked fears of resurgent inflation, triggering a sell-off across all major indices.
Dow Jones Plummets 1,200 Points
The Dow Jones Industrial Average shed over 700 points, extending its two-day decline to a staggering 1,200 points. The downturn accelerated following the release of three concerning economic indicators early in the trading session.
Trifecta of Negative Data
1. Consumer Sentiment: University of Michigan's survey revealed a sharp drop in consumer sentiment in February, the second consecutive month of decline. Fears of tariffs and inflation sent the index to its lowest level since November 2023.
2. Housing: Existing home sales in January fell to 4.08 million, significantly below analyst expectations of 4.29 million. Elevated financing costs and costly properties dampened affordability for potential buyers.
3. Services: The Purchasing Managers Index (PMI) unexpectedly contracted in February, indicating a decline in US services activity for the first time in over two years. The S&P flash U.S. services PMI dropped to 49.7, below consensus estimates and December's reading.
Index Performance at Closing Bell
* S&P 500: 6,013.13, down 1.7%
* Dow Jones Industrial Average: 43,428.02, down 1.7% (749 points)
* Nasdaq composite: 19,524.01, down 2.2%
The sell-off underscores investors' growing concerns about rising interest rates, exacerbated by the Federal Reserve's continued reluctance to cut rates until inflation eases.