Wall Street saw sharp declines as inflation data exceeded expectations and trade policy uncertainties fueled investor unease
US markets saw sharp declines Friday as concerns over persistent inflation and evolving trade policies led to investor uncertainty. The Dow Jones Industrial Average closed down more than 700 points, with all major indexes posting losses.
According to CNBC, the Dow dropped 1.69 per cent to 41,583.90, while the S&P 500 declined 1.97 per cent to 5,580.94. The Nasdaq Composite recorded the steepest drop, slipping 2.7 per cent to 17,322.99. The losses followed the latest inflation data, which showed consumer prices rose 2.8 per cent in February compared to a year earlier, exceeding market expectations.
With inflation remaining above the Federal Reserve’s 2% target, uncertainty over the central bank’s next move has grown.
Federal Reserve Chair Jerome Powell has previously stated that future rate decisions will depend on economic conditions, leaving investors uncertain about the timing of any potential cuts.
CNBC reports that market participants are reassessing their expectations for interest rates in 2024, given the persistent price pressures.
Beyond inflation concerns, renewed discussions on trade policy added to market unease. The White House is reportedly considering increasing tariffs on Chinese imports, a move that could have implications for supply chains and corporate earnings. Businesses with global exposure are monitoring the situation closely, as CNBC noted that tariff adjustments could affect a range of industries.
Technology stocks saw the largest declines, with Apple, Microsoft, and Nvidia each losing more than 3 per cent. The sector had been a key driver of market gains earlier in the year, but higher interest rates have raised concerns about future growth prospects.
Meanwhile, the energy sector faced downward pressure as oil prices declined. CNBC highlighted that fluctuations in commodity prices continue to play a role in overall market movements.
Some analysts believe that if upcoming economic data signals easing inflation, investor sentiment could improve. However, others caution that continued uncertainty surrounding trade policy and the global economy could contribute to further volatility.
Market watchers now turn their attention to the Federal Reserve’s next policy decision later this month, with expectations that the central bank’s guidance will offer further insight into the direction of interest rates.
