1. Stocks Slump as White House Confirms Tariffs
Markets were poised for a strong Friday and a third consecutive week of gains—until the White House reaffirmed its tariff plans. At 1:15 p.m. ET, officials dismissed reports of a delay and confirmed a 25% tariff on goods from Mexico and Canada, along with a 10% tariff on Chinese imports, effective .
Tariffs
The major indexes reversed course, closing lower:
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Dow Jones Industrial Average: -0.75% (-337 points)
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$.SPX(.SPX)$ : -0.5%, Despite Friday’s dip, January ended on a high note: S&P 500: +2.7%
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$NASDAQ(.IXIC)$ : -0.3% , $NVIDIA(NVDA)$
Week perf
However, the tariff implementation on Feb. 1 introduces uncertainty, posing a potential headwind for markets.
2. Economic Impact: Higher Prices and Retaliation Risks
Tariffs on integrated trading partners like Mexico and Canada could disrupt supply chains, increasing costs for U.S. consumers. Analysts estimate a 0.8% rise in average U.S. prices, with essential goods such as gasoline, avocados, beer, and meat seeing sharper price hikes.
Retaliation is likely:
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Canada may impose tariffs on critical minerals, natural gas, and electricity or restrict U.S. dairy and meat imports.
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China could take its own measures, further complicating trade dynamics.
3. Commodities: Energy and Metals in Focus
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Gas Prices Surge: European gas prices rose 6% due to unexpected supply disruptions and colder weather, pushing futures above €52/MWh. EU storage levels are at 55%, below the five-year average of 62%.
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Oil Declines: Tariff uncertainty and rising U.S. crude inventories (+3.5M barrels) pressured prices: Brent crude: $75.90 WTI crude: $72.60
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Metals Mixed: Aluminum rallied after the EU proposed a phase-out of Russian imports. Copper declined due to Trump’s tariff threats and weak Chinese economic data. Gold surged above $2,800/oz, benefiting from trade uncertainty and falling bond yields.
4. Looking Ahead: Earnings and Inflation Data
Next week, the market will focus on:
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Further tariff developments: Will Trump modify the policy or clarify exemptions?
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Earnings reports: A busier week ahead will provide key insights. $Palantir Technologies Inc.(PLTR)$ $Advanced Micro Devices(AMD)$ Alphabet, PayPal Holdings, PepsiCo, Pfizer, and Spotify Technology, Arm Holdings, Ford Motor, Qualcomm, Uber Technologies, and Walt Disney Amazon.com, ConocoPhillips, Eli Lilly…
$PLTR
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The Bureau of Labor Statistics will publish the jobs report for January on Friday. Economists are expecting growth of 165,000 nonfarm payrolls and an unchanged unemployment rate of 4.1%. On Tuesday, the BLS will release the latest Job Openings and Labor Turnover Survey.
Conclusion
Despite Friday’s turbulence, broader economic trends and central bank policies remain supportive for markets. The focus now shifts to whether tariffs will hold or evolve under ongoing negotiations…
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This article is for informational purposes only and does not constitute financial advice. Please consult a professional before making investment decisions.
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