US Stocks Fall as Jobs Miss and Trump Tariffs Hit Markets

U.S. stocks dropped sharply on Friday as investors reacted to weak job numbers and a fresh wave of global tariffs announced by President Donald Trump. The Dow, S&P 500, and Nasdaq all finished lower, with the week ending in red across major indexes. The Dow Jones Industrial Average (^DJI) lost 1.36% to 43,532. The S&P 500 (^GSPC) dropped 1.61%, falling to 6,237. The Nasdaq Composite (^IXIC) sank 1.9% as tech stocks faced a strong pullback. For the week, the Dow shed nearly 3%, the S&P was down about 2%, and the Nasdaq slipped 1.8%.

Jobs Report Misses Expectations

The U.S. job market showed more cracks in July than many expected. Only 73,000 new jobs were added last month, falling far short of the 104,000 that economists had been hoping for. And how does it get worse? The job numbers for May and June were revised down by a combined 258,000. That’s a huge adjustment and confirms what many feared: hiring is slowing down.

Unemployment also ticked up to 4.2% from 4.1%, and fewer people were working or looking for work the labor force participation rate slipped to 62.2% from 62.3% in June. Wages grew as expected. Average hourly pay was up 0.3% from last month and 3.9% compared to this time last year, which is in line with forecasts.

Looking closer at where the jobs came from, most of the growth came from private education and health services they added 79,000 jobs. Retail chipped in with about 15,700 new positions. But there were losses too. Manufacturing dropped 11,000 jobs, and both government and business services also saw cuts. All in all, the picture wasn’t great.

Bond Yields Drop as Rate Cut Bets Rise

After the release of the jobs report, U.S. Treasury yields fell sharply. The yield on the 2 year Treasury dropped more than 17 basis points to 3.78%. The 10 year yield fell 10 basis points to 4.27%.

Market odds for a Federal Reserve rate cut in September rose to 75%, according to CME Group data. That is a big jump from 37% just two days ago. Traders now expect at least two rate cuts by the end of 2025.

Federal Reserve governors Chris Waller and Michelle Bowman voted against keeping rates steady earlier this week. This marked the first dual dissent on Fed policy since 1993. Both suggested the labor market could shift quickly. President Trump weighed in Friday morning, saying the Fed board should “assume control” if Jerome Powell fails to cut rates.

Trump’s Tariff Hike Hits Dozens of Nations

Adding to market stress, President Trump signed an executive order Thursday that imposed new tariffs on imports from many countries. The tariffs range from 10% to 40%, depending on the country and product.

Canada was hit with a 35% tariff that started Friday. Other key trade partners like India, Taiwan, Thailand, and South Korea were hit with tariffs ranging from 15% to 25%. Tariffs on most other countries will begin in seven days, giving room for more negotiations.

Europe responded sharply. Germany’s DAX fell 1.89%, and France’s CAC 40 dropped 2.66%. The UK’s FTSE 100 dipped 0.5%. In Asia, South Korea’s KOSPI index dropped 3.88% on the news, while Taiwan’s markets fell 0.9%.

Amazon is falling and Apple Rises

Tech stocks were mixed following earnings reports. Amazon (AMZN) dropped as much as 8% after its AWS cloud unit missed expectations. This disappointed investors despite strong performance from competitors like Google and Microsoft.

On the other hand we have Apple (AAPL) which posted strong earnings and beat estimates thanks to better than expected iPhone sales. Its stock climbed in early trading.

Reddit Surges on Strong Results

Reddit (RDDT) saw its stock jump over 16% after reporting $500 million in second quarter revenue, beating analyst forecasts of $425 million. Adjusted earnings came in at $0.92 per share, also above estimates. The company reported 110.4 million global daily users in Q2. U.S. users totaled 50.3 million, slightly below the expected 50.5 million.

Is the Rally Continuing for Figma?

Figma (FIG) rose another 19% in early Friday trading, building on a 250% rally during its IPO debut on Thursday. Shares now trade around $119, giving the design software firm a market cap of more than $50 billion. That is over twice the $20 billion Adobe offered in 2023 before the deal was blocked.

Healthcare Stocks Rebound on Medicare News

Shares of Eli Lilly (LLY) and Novo Nordisk (NVO) rose nearly 3% Friday after reports that the Trump administration may allow Medicare and Medicaid programs to cover GLP-1 weight loss drugs like Wegovy, Ozempic, and Mounjaro. The policy, still being drafted, could reshape access to these drugs despite previous concerns from Health and Human Services Secretary Robert F. Kennedy Jr.

Energy Sector Beats Expectations

Chevron and Exxon Mobil managed to pull off solid wins this quarter, even with oil prices sliding. Chevron came out strong, reporting record production numbers and solid performance across the board a lot of that was thanks to its $55 billion takeover of Hess, which is already paying off… Exxon wasn’t far behind. It posted $7.1 billion in adjusted earnings, or $1.64 per share, which came in above Wall Street’s expectations.

What helped both giants was increased oil output, especially from the rich oil fields in Guyana. That boost in production helped offset the fact that oil prices actually fell 11% this quarter. The drop came as OPEC+ pushed more supply into the market, putting pressure on global prices. Even so, Chevron and Exxon held their ground

Outlook Remains Uncertain

Between a cooling job market, global trade tension, and growing pressure on the Fed, investors are bracing for a bumpy ride in the coming weeks. While pockets of strength remain like Apple and Reddit the broader mood has turned cautious.

As the market adjusts to these crosswinds, eyes remain on the Fed’s next move. Do you think global trade talks can ease tariff fears? Well until then, the volatility looks here to stay.