U.S. stocks fell back on Friday as Wall Street dealt with mixed signals from the Federal Reserve and the looming impact of President Trump's upcoming tariffs. After rallying midweek on the Fed’s reassurance of planned rate cuts, markets pulled back amid renewed concerns over inflation, economic growth, and trade policy uncertainty.
The Dow Jones Industrial Average (DJI) fell 0.6%, while the S&P 500 (GSPC) slipped 0.5%. The Nasdaq Composite (IXIC) also declined 0.5%. Both the S&P 500 and Nasdaq, which have entered correction territory, were striving to break a four-week losing streak.
Market Movers:
- FedEx (FDX): Shares plummeted nearly 8% after the company slashed its fiscal 2025 forecast, citing concerns over slowing industrial demand. The logistics giant’s bleak outlook underscored fears that new tariffs could further strain supply chains and dampen economic activity.
- Nike (NKE): The apparel retailer’s stock dropped sharply following its latest earnings report, which highlighted weaker-than-expected sales in key international markets. Investors are concerned about the potential impact of rising costs and shifting consumer demand amid ongoing trade tensions.
- Micron Technology (MU): The stock plunged more than 8% as the chipmaker’s margins fell short of analyst expectations, despite reporting better-than-anticipated sales. The company’s forecasted decline in margins for the next quarter added to investor unease.
- Boeing (BA): In contrast to the broader market, shares surged over 5% after securing a contract to build the U.S. Air Force’s next-generation fighter jet. This deal provided a much-needed boost to the troubled aerospace giant, which has faced production delays and safety concerns in recent years.
- Tesla (TSLA): Shares rebounded more than 4% after a tumultuous week, as Wall Street analysts adjusted their forecasts for the electric vehicle maker. While some analysts lowered their delivery estimates, investor sentiment improved on expectations that demand could stabilize.
Tariff Uncertainty Weighs on Markets
The latest market decline highlights growing investor anxiety over President Trump’s impending tariffs, set to take effect on April 2. While Federal Reserve Chair Jerome Powell attempted to reassure markets that the economic impact of the trade war remains manageable, markets remain on edge. The Fed’s revised projections of higher inflation and slower growth have added to concerns that the economy may be heading for a period of heightened volatility.
Fed’s Policy Path in Focus
The Federal Reserve’s commitment to two rate cuts this year initially spurred optimism earlier in the week, leading to a brief rally in equities. However, by Thursday, that optimism faded as investors weighed the broader implications of the central bank’s economic outlook. New York Fed President John Williams emphasized the high level of uncertainty surrounding fiscal and trade policies, reinforcing the market’s cautious stance.
Looking Ahead
Investors are bracing for a pivotal few weeks as they await further developments on Trump’s trade policies and economic data releases. With inflationary pressures still a concern and corporate earnings in focus, volatility is expected to persist. The S&P 500 and Nasdaq remain in correction territory, and traders will be closely monitoring whether the indexes can break their losing streaks in the coming sessions.