U.S. equities experienced a mixed week, with mid-cap and small-cap indexes gaining slightly while major indexes like the Dow and S&P 500 faced declines influenced by noteworthy drops in mega-cap tech stocks. Recent trade restrictions on advanced chips shook major AI companies and raised worries about U.S.-China relations. Federal Reserve Chair Powell’s comments on tariff impacts on inflation and growth provided a cautious outlook, mirrored by softer housing market indicators. Meanwhile, European equities rose, buoyed by positive trade sentiment and supportive monetary policy from the European Central Bank.
The Federal Reserve aims for clarity before adjusting rates, with Powell emphasizing that recent tariff increases are significantly larger than anticipated, impacting inflation and growth.
Builder confidence in housing remains low, with indicators showing a decline in housing starts and consumers facing affordability challenges in the market.
European markets have stabilized, with bullish sentiment in response to delayed tariffs and a supportive stance from the European Central Bank, contributing to gains across major indexes.
Retail sales surged by 1.4%, supported by strong demand in auto sales, indicating consumers are positioning themselves ahead of potential tariffs.
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