Wall Street posted sharp losses on Friday as weak labour market data and a fresh round of tariffs from President Donald Trump shook investor confidence and fuelled fears of a broader economic slowdown.
The Dow Jones Industrial Average fell 542.40 points, or 1.23%, to close at 43,588.58, posting its steepest single-day decline since mid-June.
The S&P 500 dropped 101.4 points or 1.6% to end at 6,238.0, its worst session since late May, while the Nasdaq Composite plunged 472.3 points or 2.2% to 20,650.1, suffering its largest drop since April.
The downturn followed a July jobs report that showed nonfarm payrolls rose by just 73,000, far below the consensus forecast of 110,000.
Compounding the disappointment, job gains in May and June were revised sharply lower - June’s figure cut from 147,000 to 14,000, and May’s from 125,000 to just 19,000.
Major financial companies took a hit amid mounting concern that a slowing economy would weigh on loan demand.
JPMorgan Chase lost 2.3%, Bank of America shed 3.4%, and Wells Fargo fell 3.5%.
Industrial giants also came under pressure, with GE Aerospace down 0.6% and Caterpillar losing 2.1%
The market turbulence reignited expectations for monetary easing by the Federal Reserve. According to the CME Group FedWatch Tool, futures now imply an 80.3% probability of a rate cut at the Fed’s September meeting.
Adding to the unease was Trump’s latest round of tariff hikes, announced late last week. Under the revised schedule, goods rerouted through third countries to avoid tariffs will be slapped with an additional 40% duty.
Canada, a key U.S. trading partner, will now face a 35% levy, up from 25%, as part of the administration’s intensified trade measures.
Technology stocks also weighed heavily on the broader market. Amazon plummeted 8.3% after the company issued underwhelming operating income guidance for the current quarter. Apple fell 2.5%.
The losses capped a bruising week for equity markets. The Dow tumbled 2.9%, its sharpest weekly decline since early April, the S&P 500 dropped 2.4% for its worst weekly performance since 23 May, while the Nasdaq fell 2.2%.
On the bond market, yields collapsed as investors sought safety. The benchmark 10-year Treasury yield fell 3.8% to 4.216%, while the 2-year yield tumbled 7.1% to 3.68%.
