Stocks moved slightly lower early Friday after President Donald Trump said that China had violated an agreement with the U.S. on tariffs.
The Dow Jones Industrial Average and S&P 500 were each down 0.4%, recently, while the tech-heavy Nasdaq Composite dropped 0.5%. Stocks posted modest gains on Thursday as investors responded to a blockbuster earnings report from AI chipmaker Nvidia and digested conflicting court rulings on the legality of Trump’s tariff policy.
This morning, Trump said in a post on Truth Social that China “has totally violated its agreement” with the U.S. Earlier this month, the U.S. and China agreed to temporarily suspend the massive tariffs they had imposed on one another while the two sides negotiated a broader trade deal. News that the import taxes—which stood at more than 100% on each side—had been slashed sent stocks soaring at the time.
In addition to the developments on the trade front, investors were keeping a close eye this morning on an inflation report that is followed closely by the Federal Reserve as it considers what to do next on interest rates. The Personal Consumption Expenditures index showed that inflation moderated more than economists had expected in April.
The S&P 500 and Nasdaq Composite remain on track to post their biggest monthly gains since November 2023. Through Thursday’s close, the S&P 500 had risen 6.1% in May, while the Nasdaq was up 9.9%. The Dow was up 3.8% for the month, which would be its best monthly performance since January.
Shares of the world’s largest technology companies, which led yesterday’s gains, were mostly lower in early trading Friday. Nvidia (NVDA), Apple (AAPL), Amazon (AMZN), Alphabet (GOOG), Meta Platforms (META), Tesla (TSLA) and Broadcom (AVGO) all fell slightly, while Microsoft (MSFT) inched higher.
A few companies were making big moves after reporting earnings. Shares of Gap Inc. (GAP) plunged 20% after the apparel retailer warned of the negative impact of tariffs on its full-year earnings. Cossetics chain Ulta Beauty (ULTA) surged 13% after reporting strong quarterly results.
Bitcoin was at $105,600 this morning, little changed from its levels late yesterday afternoon. The digital currency hit an all-time high of $112,000 last week, the first time it had set a new record since just before Trump’s inauguration in January.
The yield on the 10-year Treasury note, which affects borrowing costs on all sorts of loans, notably mortgages, was at 4.41%, down from 4.42% late Thursday. The yield moved as high as 4.63% last week, its highest level in more than three months, amid rising concerns about the federal deficit as the GOP budget bill moved through Congress.
The U.S. dollar index, which measures the performance of the dollar against a basket of foreign currencies, was up 0.3% at 99.55.
Gold futures were down 0.4% at around $3,305 per ounce, while West Texas Intermediate futures, the U.S. crude oil benchmark, slipped 0.4% to $60.70 per barrel.