U.S. Stocks Decline Amid Trade War Fears and Weak Jobs Data

U.S. stocks saw a decline on Friday, driven by renewed trade war jitters and disappointing jobs data, leading the Dow Jones Industrial Average to drop by 500 points.

Summary

• Stocks fell as investors reacted to the latest jobs data report.
• The Dow Jones Industrial Average dropped more than 500 points, while the S&P 500 and Nasdaq slipped 1.2% and 1.5%, respectively.
• Trade war fears enabled bears to take advantage.

The Dow Jones Industrial Average fell over 500 points, with the S&P 500 losing 1.2% and the Nasdaq 1.5%, continuing losses from Thursday, July 31, 2025.

Wall Street displayed weakness as President Donald Trump’s deadline for countries to finalize trade deals with the U.S. approached. Major indexes dropped leading up to the Friday release of the monthly jobs report.

In the previous session, the Dow closed lower, while the S&P 500 and Nasdaq slipped from near-record levels following disappointing earnings from Amazon (AMZN) and underperformance in its cloud unit, AWS, causing AMZN shares to plummet.

Despite Apple (AAPL) stock gaining after an earnings beat, it failed to support the broader market.

Weak U.S. Jobs Data

Stocks were also affected by data showing the U.S. added only 73,000 jobs in July, below the expected 104,000. This lower-than-expected nonfarm payroll growth, along with an increase in the unemployment rate from 4.1% to 4.2%, alarmed investors.

Market analysts suggest that the weak jobs report may prompt action from the Federal Reserve, with the next meeting scheduled for September, where investors are hopeful for a rate cut.

Recent decisions and other economic data have bolstered the dollar index and contributed to a slowdown in risk assets, including Bitcoin (BTC), which dropped 2% below $115k.

Stocks Retreat Amid Fresh Tariff Jitters

Trump’s deadline for trade deals has introduced new uncertainties as the U.S. applied tariffs on key trading partners, including Canada and India.

An executive order signed Thursday imposed a 35% tariff on Canadian goods, while India faces a 25% rate amidst stalled negotiations. Additionally, Switzerland was surprised by a 39% tariff aimed at their export-driven economy.

Despite these developments, a seven-day delay in the effective date of the new tariffs has given markets hope for further negotiations.