U.S. Stocks Dip Amid Trade Tensions adn Tariff Uncertainty
On Friday, U.S. stocks faced a downturn as trade tensions between the U.S. and China escalated.President Donald Trump accused China of violating their trade agreement, causing investor unease.
The Dow Jones industrial Average fell over 120 points, while the S&P 500 dropped 0.6%. The Nasdaq Composite also opened 0.4% lower. This came after a federal court paused Trump’s tariffs, adding to the market’s volatility.
However, there was some positive news. April’s core Personal Consumption Expenditures (PCE) index, a key inflation measure, rose 2.5% annually. This was the lowest since March 2021 and met economists’ expectations. The overall PCE increased 2.1% yearly, slightly below the projected 2.2%.
Despite the softer inflation reading, which is usually good for stocks and cryptocurrencies, the tariff uncertainty dampened investor sentiment. Trump claimed China had “totally violated” the trade agreement, while Treasury Secretary Scott Bessent said the talks were “a bit stalled.”
More tariff drama looms as the U.S. appeals court paused the Court of International Trade’s ruling on Trump’s global tariffs. The White House may take the case to the Supreme Court, with experts warning of a potential $2 trillion fiscal impact.
Despite the tariff uncertainty, U.S. stocks are still on track for a positive monthly close. The Nasdaq is expected to surge 10%, the S&P 500 by 6%, and the Dow by 4% in May.
