US stock futures edged higher on Friday as investors awaited a key inflation reading, while fresh tariff threats added another layer of uncertainty, particularly for Big Tech stocks.
📈 Stock Futures Performance:
✔️ S&P 500 (^GSPC): Up 0.4%
✔️ Nasdaq 100 (NQ=F): Up 0.2% after Thursday’s Nvidia-led (NVDA) sell-off
✔️ Dow Jones Industrial Average (YM=F): Up 0.5%
Key Inflation Data Eases Investor Anxiety
The January Personal Consumption Expenditures (PCE) index, the Federal Reserve’s preferred inflation gauge, provided some relief to investors:
🔹 Core PCE inflation (excluding food & energy) cooled to 2.6%, in line with expectations.
🔹 This comes after recent data had sparked fears of a potential economic slowdown and renewed inflationary pressures.
With inflation showing signs of moderation, investors are now watching for the Fed’s next policy moves regarding interest rates and market liquidity.
Tariff Concerns Resurface Amid Trade Tensions
Markets also had to digest fresh trade policy uncertainty following President Trump’s announcement of new tariffs on China, Mexico, Canada, and the EU:
🔹 China vowed retaliation, stating it would take “all necessary measures” after Trump announced an additional 10% tariff on Chinese imports, set to take effect on Tuesday.
🔹 Tariffs on Mexico and Canada are also in the pipeline.
🔹 The EU could be the next target as Trump signals additional duties.
These developments come at a time when the market is already struggling with volatility, raising concerns about how tariffs could impact global trade and corporate earnings.
February Market Performance: A Tough Month for Stocks
As February comes to a close, US stock indices are heading for sharp monthly losses:
📉 Nasdaq Composite (^IXIC): Down over 5% this month
📉 S&P 500 (^GSPC): Set for a 3% decline
📉 Dow Jones (^DJI): Also looking at a 3% monthly drop
The S&P 500 has recorded three daily drops of over 1% this week, reflecting the market’s choppy performance amid economic and geopolitical uncertainties.
Bitcoin Sell-Off Deepens Amid Crypto Market Decline
The crypto market took another hit, with Bitcoin (BTC-USD) sinking 7% to its lowest level since November.
🔹 The cryptocurrency has now dropped 25% from its record high, marking a broader crypto rout.
🔹 Increased regulatory scrutiny, profit-taking, and macroeconomic concerns have contributed to the sharp decline.
Earnings Impact: Dell and HP Slip on AI Server Costs
Several big-name companies reported earnings, but the results failed to boost investor confidence:
🔻 Dell (DELL): Stock fell 2% after earnings highlighted concerns over higher AI server costs.
🔻 HP (HPQ): Shares dropped 3%, even though its earnings met expectations.
The decline in hardware and tech-related stocks reflects growing concerns about AI-related costs and supply chain pressures.
Market Outlook: What’s Next for Investors?
🔍 Key factors to watch:
✅ Fed’s response to inflation trends – Will interest rate cuts come sooner or later?
✅ Tariff developments and potential retaliatory moves from China and the EU.
✅ Tech sector performance, especially AI-related stocks, amid cost pressures.
✅ Crypto market stability – Will Bitcoin recover or continue its decline?
As markets enter March, investors will be closely monitoring economic data, trade policies, and Federal Reserve signals to gauge the next moves in stocks, crypto, and global markets.
