U.S. stocks closed broadly lower on Friday, capping off a tough week for equities as tariff headlines and rising inflation expectations took center stage. The S&P 500 fell 1.5% for the week, wiping out the prior week’s gains and putting traders back into risk-off mode.
Let’s break down what happened, what we were watching going into Friday’s sell-off, and what’s on deck for the week ahead.
Friday Recap: Tariffs & Inflation Reignite Market Jitters
Markets came under pressure after news broke of a new tariff on auto imports, raising fears of retaliatory measures and further disruptions to global trade. This was followed by data showing that consumer spending in February rose less than expected, even as the Fed’s preferred inflation gauge (Core PCE) accelerated—two trends that don’t sit well together.
Higher inflation + weaker spending = tougher decisions for the Fed, and that reality spooked investors heading into the weekend.
Macro Viewpoint: Key Shifts Ahead
The start of April could bring two major policy catalysts:
- Reciprocal tariffs, expected to be announced Wednesday by President Trump, have the potential to ripple through multiple sectors.
- The Federal Reserve’s tapering of its quantitative tightening (QT) program also begins in April, which could impact liquidity and investor sentiment.
Combine those with already fragile consumer confidence, and you get a recipe for choppy trading conditions.
Impact Snapshot: Key Events This Week
Here’s what we’re watching closely in the week ahead:
Tuesday
📉 ISM Manufacturing PMI – Gauge of U.S. factory activity. A drop could signal deeper economic cooling.
📊 JOLTS Job Openings – Key insight into labor demand. Lower openings may suggest labor market weakness.
Wednesday
👷 ADP Non-Farm Employment – A preview of Friday’s NFP.
🌐 Trump’s Reciprocal Tariff Announcement – Expect market volatility if this triggers retaliatory measures or hits supply chains.
Thursday
📈 Unemployment Claims – Closely watched for any cracks forming in job stability.
Friday
💼 Non-Farm Payrolls (NFP) – The headline jobs number. Markets will react to any surprise.
📉 Unemployment Rate – Currently low, but a sharp move higher would raise red flags for investors.
Final Thoughts: Stay Nimble, Stay Informed
After a shaky close to March, the start of April is loaded with catalysts that could swing sentiment in either direction. With tariffs, Fed policy, inflation data, and labor market signals all converging this week, expect elevated volatility and swift market reactions.
Keep your eyes on the headlines, respect your levels, and don’t get caught offsides—especially with jobs data and policy changes looming.