Stock market today: Dow, S&P 500, Nasdaq slide as inflation, tariff fears push stocks to another losing week
Published On Feb 7, 2025, 5:53 PM
US stocks experienced a significant downturn, led by a nearly 1% drop in the S&P 500 and a 1.4% fall in the Nasdaq Composite. The decline follows rising concerns about potential new tariffs under President Trump's administration, alongside an uptick in inflation expectations among consumers, which soared to 4.3%. A recent jobs report revealed that the labor market remains resilient despite missing expectations with only 143,000 new jobs added in January. Companies like Amazon and Tesla suffered losses due to disappointing revenue outlooks and sales performance respectively, leading to decreased investor confidence across major sectors in the market.
Stock Forecasts
SPY
Negative
The imposition of new tariffs is likely to dampen consumer sentiment and spending, increasing inflation concerns, which will likely hinder stock recovery in the short term. Companies heavily reliant on imports or operating in affected sectors may see further stock declines. Furthermore, inflationary pressures could lead to more volatility in tech stocks, particularly those like Amazon facing operational challenges. Consider focusing on defensive sectors that can withstand economic downturns.
TSLA
Negative
Tesla's struggles in the Chinese market coupled with losing ground to competitors suggest a continued decline in investor confidence. The significant drop in deliveries could impact their market position and long-term valuation negatively. As the market reacts to these glossed-over operational challenges, expect continued downward pressure on Tesla's stock.
AMZN
Negative
Amazon's inability to meet revenue forecasts amid operational challenges suggests continued vulnerability. Despite ongoing investments in AI infrastructure, the inability to fulfill market demand may lead to further stock price declines as projections indicate a tough 2025 ahead for tech stocks.
XLP
Positive
With inflation expectations on the rise, utilities and consumer staples, which typically provide stable returns during economic slowdowns, could see more interest from investors seeking safety, thus potentially providing a more stable investment environment compared to tech stocks. However, overall market sentiment remains pessimistic right now.
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