Shares in the Wall Street, United States, saw a sharp sell-off in Friday's session (March 28, 2025), on the back of by fresh inflation data and growing uncertainty on US President Donald Trump's trade policies.
The Dow Jones Industrial Average fell by 715.80 points, or 1.69 per cent, closing at 41,583.90. The S&P 500 tumbled 112.37 points, or 1.97 per cent to end at 5,580.94. Elsewhere, the tech-heavy Nasdaq Composite plunged 481.04 points, or 2.7 per cent, to finish at 17,322.99.
With Friday’s move, Dow Jones is down about 2 per cent year-to-date (YTD), Nasdaq Composite has corrected more than 10 per cent YTD, and S&P 500 index is down by nearly 5 per cent YTD.
Mounting Inflation Fears
In the US, inflation picked up last month, and consumer spending barely rose, showing signs that the economy is in the slowdown.
The US Federal Reserve’s preferred measure of US inflation, the core index of personal consumption expenditure, which excludes the volatile food and energy categories, rose from 2.6 per cent to 2.8 per cent in February, 2025. This is above Fed's expectation of 2.7 per cent.
Consumer spending, which makes up more than two-thirds of the economy, grew by 0.4 per cent after a revised 0.3 per cent fall in January, 2025, according to data from the US Commerce Department released on Friday.
The latest inflation report comes as the White House has made several tariff announcements recently, leading to a turmoil in the market.
Trump’s Tariff Woes
Earlier this week, Trump had announced a 25 per cent tariff on all cars that are not made in the US. This announcement rattled market participants that trade wars could intensify going ahead.
Investors are now waiting for further clarity on April 2, when Trump is expected to announce more tariff plans.
