Wall Street Drops After Trump’s New Tariff Threat, Ends Week Lower
Stock indices fell on Friday as markets reacted to new tariff threats from U.S. President Donald Trump and concerns about their impact on inflation.
All three major Wall Street indexes declined in Friday’s trading. The Dow Jones Industrial Average, which includes 30 corporate giants, dropped 0.99% to 44,303.40 points. The S&P 500, tracking the most valuable companies, fell 0.95% to 6,025.99, while the tech-heavy Nasdaq Composite lost 1.36%, closing at 19,523.40 points.
“Next week, I will announce reciprocal tariffs to ensure we are treated fairly by other countries,” Trump said Friday after meeting with Japanese Prime Minister Shigeru Ishiba in the Oval Office. However, he did not specify which countries would be targeted.
On the economic front, nonfarm payroll data showed that U.S. job growth slowed in January, but the unemployment rate dropped to 4%. This reinforced expectations that interest rates would remain stable for an extended period.
Markets continue to anticipate that the Federal Reserve (Fed), which left rates unchanged last week, will delay any adjustments for months. This comes as inflation expectations rise due to Trump’s policies.
Among major stocks, Amazon shares (-4%) tumbled after joining Microsoft (-1.46%) and Alphabet (-3.19%) in disappointing cloud business earnings. Additionally, Amazon issued an underwhelming revenue forecast.
Sector Performance and Outlook
By sector, all declined on Friday, led by consumer discretionary (-2.52%), weighed down by Amazon, and communications (-1.22%), impacted by Alphabet. Within the Dow Jones, Amazon was the second-worst performer of the session, only behind Nike (-4.27%).
Friday’s losses pushed major indexes into negative territory for the week, which was marked by volatility over trade concerns. The Dow Jones fell 0.54% for the week, the S&P 500 dropped 0.24%, and the Nasdaq declined 0.53%.
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