US stocks followed European peers lower on Friday, with the dollar strengthening amid lingering economic uncertainties and churning geopolitical tensions. Despite a lack of catalysts to boost investor risk appetite, the dollar gained ground against major currencies, while gold retreated from its record high.
The Dow Jones Industrial Average fell 223.38 points, or 0.52%, to 41,733.07, as all three major US indexes lost ground in early trading. Economically sensitive stocks such as transport, housing, and materials underperformed. The S&P 500 fell 23.48 points, or 0.41%, to 5,639.41, while the Nasdaq Composite dropped 51.15 points, or 0.28%, to 17,641.63.
Central bank policy meetings dominated investor attention this week, with the US Federal Reserve, Bank of Japan, and Bank of England holding rates steady. However, a cautious tone from monetary policymakers has fostered uncertainty, with Fed Chair Jerome Powell describing it as “unusually elevated.” This sentiment has weighed on markets, particularly in Europe.
Investors now focus on the details of President Trump’s reciprocal tariffs, which are expected to take effect on April 2. The impending deadline has prompted caution, leading to gains for safe-haven assets such as gold and the dollar. Geopolitical tensions also contributed to the decline, with Israeli airstrikes on Gaza and a Ukrainian drone attack raising concerns about regional stability.
Meanwhile, Germany’s massive fiscal stimulus package is on track to pass its upper house of parliament on Friday. On the economic front, investors await details from the US Commerce Department on fourth-quarter GDP and Personal Consumption Expenditures, which are expected to be released next week.
Source: https://www.reuters.com/markets/global-markets-wrapup-1-2025-03-21