Wall Street Faces Sharp Decline Amid Inflation and Tariff Fears

Wall Street stocks fell sharply on Friday. Big tech companies like Amazon and Microsoft saw their stock prices drop after new U.S. data raised concerns about weak economic growth and high inflation. The Trump administration is increasing tariffs, which means goods from other countries will become more expensive.

In February, people in the U.S. spent less money than experts expected, and prices grew more than they had in the past year. A survey revealed that people believe inflation will stay high for a long time. This news worried investors because the tariffs announced by President Trump could make prices go up even more and might prevent the Federal Reserve from lowering interest rates.

Due to inflation and tariff fears, major companies lost value. Apple’s stock fell by 2.7%, Microsoft dropped by 3%, and Amazon decreased by 4.3%. Overall, the S&P 500 index went down 1.97% to 5,580.94 points. The Nasdaq fell by 2.70% to 17,322.99 points, and the Dow Jones Industrial Average dropped by 1.69% to 41,583.90 points. Most parts of the S&P 500 fell, especially communication and consumer services.

Interest rate futures show that traders think there is a 76% chance the Fed will cut interest rates in June. The S&P 500 is now down about 9% from its highest point this year, and the Nasdaq is off by around 14% from its previous record.

Investors are worried because they are unsure about the economic situation, which is making them more cautious. An index for banks that depend on interest rates fell by 2.3%. The CBOE volatility index, which measures market uncertainty, rose almost 3 points.

On Friday, shares of CoreWeave, a company backed by Nvidia, opened 3% lower in its stock market debut. Auto stocks suffered after Trump announced a 25% tariff on imports, causing General Motors to fall by 1.1% and Ford by 1.8%. Lululemon shares dropped by 14% after the company lowered its annual sales forecast due to tariff concerns.

Mining companies like Harmony Gold and Gold Fields saw their stocks rise by 9.5% and 4.5%, respectively, because of higher gold prices linked to trade worries. The S&P 500 is set to have its first quarterly decline in six quarters, while the tech-heavy Nasdaq is facing its steepest quarterly drop since 2022.

UBS Global Wealth Management reduced its year-end target for the S&P 500 from 6,600 to 6,400. Wolfspeed’s stock plummeted by 52% after the company appointed a new CEO amid struggles to improve finances. More companies in the S&P 500 saw their stock prices drop than rise, with a ratio of 4.5-to-one. While the S&P 500 recorded 10 new highs and 23 new lows, the Nasdaq saw 35 new highs and a staggering 358 new lows. Trading volume was lower than usual, with 14.3 billion shares changing hands, compared to an average of 16.2 billion shares over the previous 20 sessions.