U.S. stocks tumbled Friday as investors weighed a weaker-than-expected February jobs report and ongoing uncertainty surrounding tariffs and economic growth. The Dow Jones Industrial Average (DJI) was down 0.6% in midday trading, while the S&P 500 (GSPC) fell 0.9%, on pace for its worst weekly performance of the year. The tech-heavy Nasdaq Composite (IXIC) dropped 1.2%, extending its recent correction as investors continue to rotate out of riskier assets.
The February jobs report showed the U.S. economy added 151,000 jobs last month, missing economists' expectations of 160,000. Meanwhile, the unemployment rate ticked up to 4.1% from 4%, further fueling fears of a slowing labor market at a time when inflation remains elevated and geopolitical trade tensions persist.
Market Movers:
- Nvidia (NVDA) -2.38%: Shares of the AI chip leader fell more than 2% on Friday, with its market cap now roughly $1 trillion below its record high in early January. Investors remain cautious after Chinese AI startup DeepSeek debuted a competing chatbot model last month, intensifying concerns about Nvidia's lofty valuation in an increasingly competitive market.
- Tesla (TSLA) -3.94%: Shares slid nearly 4%, wiping out almost all of the stock’s gains since the November 2024 U.S. presidential election. Initially seen as a beneficiary of a Trump victory, investor sentiment has soured amid escalating trade tensions and heightened fears of slower economic growth that could dampen electric vehicle demand.
- Bitcoin (BTC-USD) +2.1%: Bitcoin briefly climbed above $91,000 as investors anticipated a White House crypto summit, where industry leaders like Coinbase CEO Brian Armstrong are set to meet with officials. Optimism around Trump’s executive order to create a strategic Bitcoin reserve has added fresh momentum to the token’s recent rally.
Jobs Report Signals Labor Market Cooling
February’s payroll gain of 151,000 fell short of expectations, marking another sign of moderation in the labor market. Sectors like construction saw notable gains, adding 19,000 jobs for the month, but the broader picture is mixed. The unemployment rate’s uptick to 4.1% has increased speculation that the Federal Reserve may need to adjust its policy stance if job growth continues to soften.
Investors are now eagerly awaiting remarks from Fed Chair Jerome Powell later today, hoping for clues on how policymakers are balancing employment data against persistent inflation and the evolving threat of stagflation triggered by ongoing tariffs.
Trade Turmoil Casts Long Shadow
Tariff policy remains a top concern for Wall Street as President Trump’s trade war strategy sends ripple effects through multiple sectors. While tariffs on certain Mexican and Canadian goods were temporarily paused, uncertainty over long-term policy has increased volatility. Canada responded by delaying its next wave of retaliatory duties, but Mexico has yet to signal its position, keeping investors on edge as they assess potential supply chain disruptions and price hikes.
Construction Sector Strength, But Risks Loom
While the broader labor market slowed in February, the construction industry showed surprising strength with its largest hiring surge since Q3 2024. However, the sector also experienced a rise in its unemployment rate, climbing to 7.2%. Economists warn that the gains may be short-lived, particularly as cuts to federal spending under the Trump administration could eventually weigh on public infrastructure projects and government-funded construction work.
Looking Ahead
As the week wraps up, all eyes turn to Fed Chair Jerome Powell’s speech, which may offer critical insight into the central bank’s outlook amid mixed economic signals. Investors will also be closely monitoring next week’s inflation data and any further developments on U.S. trade policy, both of which could determine whether the recent market turbulence is just the beginning of a deeper correction or a temporary setback.