US stocks tumble as deepening consumer gloom raises stagflation fears https://t.co/VVQUs9BYIZ via @ft
— Oliver Stuenkel 🇧🇷 (@OliverStuenkel) March 28, 2025
The Dow Jones Industrial Average plunged more than 700 points on Friday as investors grappled with stubborn inflation data and growing uncertainty surrounding US trade policy. The S&P 500 shed 1.97%, ending the week down for the fifth time in the last six weeks, while the Nasdaq Composite plummeted 2.7%. Shares of several technology giants, including Google-parent Alphabet, Apple, and Microsoft, each dropped more than 4%, putting pressure on the broader market.
Hardworking Americans have invested in their retirement plans their entire lives—we trust them to support us in our old age. President Trump’s policies are taking our retirement away.https://t.co/3J45CAhgIw
— Joe Morelle (@RepJoeMorelle) March 28, 2025
The latest inflation report showed that the personal consumption expenditures (PCE) price index rose 2.8% in February, higher than the expected 2.7%, stoking concerns about persistent inflation. The University of Michigan’s final read on consumer sentiment for March also reflected the highest long-term inflation expectations since 1993. Scott Helfstein, head of investment strategy at Global X, noted that the market is getting squeezed by both sides, with uncertainty around reciprocal tariffs hitting major exporting sectors like tech and concerns about a weakening consumer facing higher prices.
#NewsFatafat | Deep gashes on the Wall Street with all three benchmark indices closing in the red. Hotter-than-expected inflation data and uncertainty over upcoming tariffs send markets in downward spiral#Nasdaq #WallStreet pic.twitter.com/KcZHv6iHkY
— ET NOW (@ETNOWlive) March 29, 2025
President Donald Trump’s recent tariff announcements have further roiled the market, with investors looking ahead to April 2 for further clarity on his plans.
Market volatility amid inflation concerns
Canadian Prime Minister Mark Carney told Trump that the Canadian government will implement retaliatory tariffs following Wednesday’s announcements.
Wall Street’s VIX index, which tracks fear and greed, soared nearly 20% from its close on Thursday, touching a lunchtime high of 22.18, the highest absolute level since March 18. The stock market may have made an “intermediate-term low,” according to Piper Sandler chief market technician Craig Johnson, who believes that equities have found some footing off the March lows from which to build upon in the upcoming weeks. In corporate news, CoreWeave, a significant player in the artificial intelligence sector, opened at $39 per share in its Nasdaq debut Friday, raising $1.5 billion in its initial public offering.
Cryptocurrencies also tumbled with equities, with Bitcoin dropping more than 3% and Ethereum falling 6%. The persistent inflation reading implies that the interest rate cuts long-awaited by investors may be further delayed, as the Fed typically raises borrowing costs to cool inflation. The Federal Reserve has upped its inflation forecast and anticipates less economic growth, citing ongoing uncertainties, while President Trump has indicated he might be lenient on implementing his reciprocal tariffs, leaving economists to speculate on the potential impact on inflation and prices for consumers.
Photo by; Sergey Zolkin on Unsplash
