(Sharecast News) - US stocks dropped sharply on Friday with the S&P 500 hitting its lowest level in two weeks as risk appetite was hammered by an upside surprise to inflation data.
"Oil is down, gold is up and volatility is surging. This is a classic risk-off move that shows how fragile sentiment remains. After a few days of calm on the tariff front, Trump's auto tariffs have really spooked investors, who are once again slashing equity exposure," said Chris Beauchamp, chief market analyst at IG.
The Dow finished 1.7% lower at 41,583.90, the Nasdaq sank 2.7% to 17,322.99, while the S&P 500 tumbled 2.0% to 5,580.94 - its lowest close since 13 March.
Auto stocks were continuing to provide a drag on the market a day after Donald Trump slapped a 25% tariff on "all cars that are not made in the United States".
"Having just announced a 25% import duty on cars and many car parts, US president Donald Trump intends to escalate his trade wars on 2 April ('liberation day') by unveiling a wide range of tariffs," said economists at Berenberg in a note. "Judging by his rhetoric and actions so far, he seems less willing to strike deals and more ready to accept significant damage to the US economy than we had assumed initially."
Economic data misses the market
Friday's primary focus was the personal consumption expenditures price index, which revealed the Federal Reserve's preferred measure of inflation unexpectedly rose in February.
The year-on-year change in the core PCE index, which excludes volatile food and energy items, increased to 2.8% last month, up from 2.7% in January and ahead of economists' predictions for no change. The monthly change in the core PCE index was 0.4%, picking up from 0.3% and ahead of the 0.3% expected.
Meanwhile, personal incomes rose by 0.8% in February, marking the strongest rate of monthly growth since January 2024. This was up from the revised 0.7% increase registered in January and the 0.4% consensus forecast.
Elsewhere on the macro front, the University of Michigan's consumer sentiment index was revised lower in March, down from a preliminary reading of 57.9 to 57 - well below February's 64.7 print and the lowest level since November 2022.
Market movers
Athletic wear business Lululemon dropped 14% after providing weaker-than-expected first-quarter and full-year guidance, blaming a weak consumer environment amid macro and inflation fears.
Others in the sector, such as Footlocker and VF Corp, fell in sympathy, with sentiment also dragged down by fashion conglomerate Oxford Industries missing estimates with full-year forecasts.
Auto stocks including Ford Motor and General Motor were trading firmly in the red, extending losses made on Thursday.
Meanwhile, blue chips were weighing heavily on markets, with Apple, Amazon.com, Tesla, Microsoft and Nvidia all finishing with heavy losses.
Dow Jones - Risers
Merck & Co. Inc. (MRK) $89.23 1.86%
Amgen Inc. (AMGN) $306.95 0.39%
Johnson & Johnson (JNJ) $163.61 0.36%
Walgreens Boots Alliance, Inc. (WBA) $11.19 0.27%
Unitedhealth Group Inc. (UNH) $516.04 0.06%
Dow Jones - Fallers
Intel Corp. (INTC) $22.71 -3.85%
Nike Inc. (NKE) $63.29 -3.81%
Boeing Co. (BA) $173.08 -3.24%
Microsoft Corp. (MSFT) $378.80 -3.02%
Caterpillar Inc. (CAT) $329.69 -2.83%
Goldman Sachs Group Inc. (GS) $542.98 -2.83%
Salesforce.Com Inc. (CRM) $269.97 -2.82%
Apple Inc. (AAPL) $217.90 -2.66%
Dow Chemical Co. (DOW) $34.36 -2.50%
3M Co. (MMM) $144.72 -2.43%
S&P 500 - Risers
Welltower Inc (WELL) $153.42 2.33%
Amer Water Works (AWK) $146.30 2.22%
PPL Corp. (PPL) $35.69 2.09%
Bristol-Myers Squibb (BMY) $60.02 1.90%
Merck & Co. Inc. (MRK) $89.23 1.86%
Centerpoint Energy Inc. (CNP) $36.25 1.63%
Edison International (EIX) $58.17 1.55%
FirstEnergy Corp. (FE) $40.06 1.55%
Progressive Corp. (PGR) $279.09 1.53%
Duke Energy Corp. (DUK) $119.43 1.50%
S&P 500 - Fallers
Dollar Tree Inc (DLTR) $72.75 -5.46%
Paypal Holdings Inc (PYPL) $65.15 -5.39%
Delta Airlines Inc. (DAL) $43.84 -5.01%
Alphabet Inc. Class C (GOOG) $156.06 -4.89%
Alphabet Inc. Class A (GOOGL) $154.33 -4.88%
Foot Locker Inc. (FL) $14.51 -4.78%
VF Corp. (VFC) $15.69 -4.74%
MetLife Inc. (MET) $79.23 -4.60%
DENTSPLY Sirona Inc. (XRAY) $14.93 -4.54%
United Airlines Holdings Inc (UAL) $70.23 -4.49%
Nasdaq 100 - Risers
Vodafone Group Plc ADS (VOD) $9.45 0.96%
Gilead Sciences Inc. (GILD) $111.79 0.57%
Kraft Heinz Co. (KHC) $30.24 0.57%
eBay Inc. (EBAY) $67.16 0.52%
Amgen Inc. (AMGN) $306.95 0.39%
Mondelez International Inc. (MDLZ) $67.72 0.33%
Walgreens Boots Alliance, Inc. (WBA) $11.19 0.27%
Regeneron Pharmaceuticals Inc. (REGN) $637.36 0.24%
Nasdaq 100 - Fallers
Qvc Group Inc Series A (QVCGA) $0.20 -6.23%
Dollar Tree Inc (DLTR) $72.75 -5.46%
Paypal Holdings Inc (PYPL) $65.15 -5.39%
Baidu Inc. (BIDU) $93.37 -5.13%
Alphabet Inc. Class C (GOOG) $156.06 -4.89%
Alphabet Inc. Class A (GOOGL) $154.33 -4.88%
DENTSPLY Sirona Inc. (XRAY) $14.93 -4.54%
Sirius XM Holdings Inc (SIRI) $22.75 -4.49%
Wynn Resorts Ltd. (WYNN) $82.33 -4.43%
Netflix Inc. (NFLX) $933.85 -4.39%
51.99 (0.61%)
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