MARKET SNAPSHOT
U.S. stocks deepened their losses ahead of a long holiday weekend amid concerns over the fiscal deficit. Treasury yields fell for the session, but still ended the week higher, as investors focused on the widening U.S. deficit and Trump revived tariff turbulence. Oil prices slipped amid concerns demand won't keep up with expected output gains. Gold prices rose as the dollar weakened.
MARKET WRAPS
EQUITIES
President Trump launched new broadsides in his tariff campaign, threatening to impose a 50% rate on the European Union within days, and warning Apple that foreign-made iPhones could face significant levies.
The fresh threats are aimed at core pillars of global commerce: one of the world's most valuable companies and one of the U.S.'s biggest trading partners. The initial market response reflected revived fears that tariff policy could knock economic growth.
A European official said of the president's threat: "I don't think there is anything set in stone... We are negotiating," while Trump in an Oval Office press briefing said he is "not looking for a deal" with the EU.
The Dow Jones Industrial Average declined 0.6%. The broad S&P 500 gave back 0.7% and the Nasdaq dropped 1%.
Stock investors are relatively sanguine because "they now know that Trump will pivot on trade," said Andrew Slimmon, senior portfolio manager at Morgan Stanley Investment Management, referring to the president's softer stance since late April. Stock prices would have dropped far more dramatically had Trump made his comments about Europe in March, he said. "The market has finally figured out not to overreact to every salvo."
Earlier Friday, stocks in Asia were mixed.
China's benchmark Shanghai Composite and the Shenzhen Composite Index both declined 0.9%. The ChiNext Price Index lost 1.2% while Hong Kong's Hang Seng was flat.
Japan's Nikkei 225 index climbed 0.5%.
Australia's S&P/ASX 200 edged up by 0.1% and New Zealand's declined 0.5%.
COMMODITIES
Oil futures ended a choppy trading week with modest declines as the market fretted about the June 1 OPEC+ meeting and prospects of the group adding another 411,000 barrels a day to production in July.
"A drop lower in prices could be expected over the next week but we are unlikely to test our previous lows," Alex Hodes of StoneX said.
Trade issues resurface with President Trump's threat of a 50% tariff on the EU, while the U.S. and Iran ended nuclear talks in Rome without a deal, but agreeing to continue negotiating.
WTI and Brent each gained 0.5% to settle at $61.53 and $64.78 a barrel, respectively, marking weekly losses of 1.5% and 1%.
Gold, copper, and silver rose after Trump's tariff threats.
For gold, traders think strength will stay consistent into the fall and winter months.
"We expect some strong range trading opportunities between $3,100 a troy ounce and $3,500 a troy ounce," said Maximilian Layton of Citi Research.
Front-month gold climbed 2.2% to settle at $3,363.60 a troy ounce.
TODAY'S TOP HEADLINES
Trump Threatens Fresh Tariffs on EU, iPhones and Rival Devices
WASHINGTON-President Trump fired new salvos in the global trade war on Friday, threatening a 50% tariff on imported goods from the European Union and new duties on iPhones and other smartphones made overseas.
Trump said the EU had been "very difficult to deal with" on trade in a Friday morning social-media post. Less than a half hour earlier, he threatened Apple and its chief executive, Tim Cook, with a tariff of at least 25% on iPhones made overseas.
"I have long ago informed Tim Cook of Apple that I expect their iPhone's that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else," he wrote on Truth Social.
U.S. New Home Sales Rise in April, Defying Economic Uncertainty
Sales of new homes climbed again in April, the Commerce Department reported Friday, as buyers shrugged off concerns about uncertainty over the economic outlook and high mortgage costs.
Sales of new single-family homes rose 10.9% to 743,000 from 670,000 in March. Sales had been expected to come in at 695,000 according to economists polled by The Wall Street Journal.
Monthly data on sales are volatile and tend to be revised. April's data came with a 13.5% margin of error.
U.S., Iran Aim for Framework to Guide Talks Toward Nuclear Deal
ROME-Iran and the U.S. are aiming to set the parameters for a new deal on Tehran's nuclear program while leaving important details still to be negotiated, people familiar with the talks said.
Aiming for such a framework to guide progress toward a deal could raise concerns among some U.S. lawmakers, and in Israel, that Iran would use the time to continue its nuclear work without committing to a final agreement. It took 18 months of grueling negotiations to reach the 2015 nuclear deal, which set tight but temporary limits on Iran's nuclear work. There is no guarantee follow on talks would end in a deal.
Seeking a shared understanding for further negotiations on Iran's nuclear program would in some ways mirror a 2013 interim agreement that preceded the 2015 nuclear deal Iran reached with the Obama administration. The 2013 deal provided some sanctions relief for Iran and some steps to curb its nuclear program.
Booz Allen Cuts 2,500 Consulting Jobs as Trump Cracks Down on Federal Spending
Booz Allen plans to cut roughly 2,500 jobs after the company warned that it is feeling the effects of the Trump administration's crackdown on federal contracting.
Shares fell 16.5% on Friday after Booz Allen executives told investors that the firm is seeing a slowdown in some government spending and that it expected its business to be under pressure in the first half of the fiscal year.
Booz, which makes 98% of its $12 billion in annual revenue from government-related work, is especially vulnerable to the Trump administration's plans to cut spending on federal contracts.
'It's Time for Nuclear' to Meet Growing U.S. Power Needs, Trump Declares
President Trump aims to accelerate the slow-moving nuclear power industry through a series of executive orders signed Friday.
He outlined plans to overhaul the U.S. nuclear regulator, fast-track licenses for new projects, boost domestic fuel supplies and use federal lands for reactors for the military or large data centers for artificial intelligence.
"It's time for nuclear," Trump said at a signing ceremony at the White House attended by energy executives including Constellation Energy Chief Executive Joseph Dominguez and Jacob DeWitte, who leads nuclear developer Oklo.
Trump to Allow Nippon-U.S. Steel Deal to Move Forward
Nippon Steel received a conditional green light from President Trump to take control of U.S. Steel under what he described as a partnership.
Key aspects of the deal still need to be ironed out. But Trump's announcement signaled that the Tokyo-based company could eventually enter the American steel market and make the big investments envisioned when it reached a $14.1 billion deal to take over U.S. Steel.
Trump defined the agreement as a partnership, spurring some confusion at the companies on Friday afternoon, according to people involved in the deal talks. Both Nippon and U.S. Steel were seeking more guidance from the administration about how much ownership Nippon could ultimately gain.
Expected Major Events for Monday
05:00/SIN: Apr Industrial Production Index
05:00/JPN: Mar Indexes of Business Conditions - Revision
08:30/HK: Apr External Merchandise Trade
10:59/THA: Apr Trade data
21:00/SKA: May Consumer Sentiment Index
23:50/JPN: Apr Services Producer Price Index
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(END) Dow Jones Newswires
May 25, 2025 16:30 ET (20:30 GMT)
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