The Trump Effect | Markets react with mixed trends—tech stocks slide, Bitcoin holds strong, and crude takes a hit. 📉📈 #StockMarket #Investing pic.twitter.com/AVxmHeDjDt
— ET NOW (@ETNOWlive) March 11, 2025
U.S. stocks fell sharply on Friday as concerns about federal policies, including tariffs, weighed heavily on consumer and business outlooks. The S&P 500 sank 1.7% for its worst day in two months, the Dow Jones Industrial Average dropped 748 points, and the Nasdaq composite tumbled 2.2%. The losses accelerated through the day following several weaker-than-expected economic reports.
Stocks To Watch | 📊Ready, set, trade! Keep an eye on these stocks as they set the market abuzz #StockMarket pic.twitter.com/RCEOEbDwNP
— ET NOW (@ETNOWlive) March 11, 2025
One report highlighted that activity unexpectedly shrank for U.S. services businesses, with many in the survey reporting declining optimism due to concerns about Washington’s policies. Chris Williamson, chief business economist, said, “Companies report widespread concerns about the impact of federal government policies, ranging from spending cuts to tariffs and geopolitical developments.”
Another report indicated that U.S. consumers are preparing for price increases, partly due to anticipated tariff impacts.
Dollar weakness continues this morning as illustrated by the 0.5% depreciation in the DXY index. #economy #markets pic.twitter.com/B469xhis1x
— Mohamed A. El-Erian (@elerianm) March 11, 2025
The survey forecasted that prices would be 4.3% higher 12 months from now, a significant jump from the previous forecast of 3.3% inflation.
Expectations for inflation are also rising among political independents and Democrats, though they are falling slightly among Republicans. Sales of previously occupied homes fell more than expected last month, affected by rising prices and higher mortgage rates.
FYI, my thoughts on the "why" and "so what" of the recent sharp drop in US stocks and their underperformance relative to other countries.https://t.co/9Ptnq8wYNK#economy #markets @FT #stocks #investors #investing
— Mohamed A. El-Erian (@elerianm) March 11, 2025
Despite the recent turmoil, the U.S. stock market remains up for the year, and most experts do not foresee an imminent recession.
Nevertheless, Friday’s reports have raised concerns about the resilience of the economy. Stocks of smaller companies, which are more closely tied to the U.S. economy than multinational firms, fell more than the rest of the market, with the Russell 2000 index dropping 2.9%.
Dow drops amid tariff concerns
Within the big companies of the S&P 500 index, three out of every four stocks fell. Technology stocks and other high-growth sectors took significant hits. Nvidia sank 4.1%, United Airlines lost 6.4%, and Newmont Mining fell 5.7%.
Akamai Technologies saw a dramatic drop, losing 21.7% despite reporting stronger-than-expected profits for the latest quarter; investors were disappointed with its future revenue forecasts. Conversely, Celsius Holdings, which markets energy drinks, saw its shares leap 27.8% after announcing the acquisition of Alani Nu for $1.65 billion. Analysts praised the deal, noting that it should quickly add to Celsius’ profits.
Stability was found in stocks of companies that offer steady profits regardless of economic conditions. For example, the water utility American Water Works rose 3.1%. Before Friday’s sharp decline, the S&P 500 had shown little movement for the week.
A contributing factor to the earlier stability was better-than-expected profit reports from several companies, which had previously offset economic concerns. However, continued uncertainty over federal policies, particularly tariffs, and their impact on inflation and interest rates, has unsettled investors. Yields in the Treasury market fell following the weak economic reports, with the 10-year Treasury yield dropping to 4.42% from 4.51% late Thursday.
