Evening Market Recap

Sophia Reyes · August 1, 2025 6:11 PM

Market Snapshot for Friday August 1^st, 2025

S&P 500 – 6,238.01 (-1.60%)

Dow Jones – 43,588.58 (-1.23%)

NASDAQ – 20,650.13 (-2.24%)

Market Performance

U.S. stocks tumbled Friday as President Trump imposed sweeping tariff hikes on nearly all major U.S. trading partners and the July jobs report pointed to a weakening labor market.

The Dow Jones Industrial Average (^DJI) slid over 500 points, or roughly 1.2%. The S&P 500 (^GSPC) fell about 1.6%, marking its worst single-day performance since May. The Nasdaq Composite (^IXIC) dropped around 2.2%. All three major indexes ended the week with losses exceeding 2%.

European stocks declined on Friday following President Trump’s confirmation of new tariffs, including a 15% duty on goods from the European Union and a 10% rate on imports from the UK.

In London, the FTSE 100 (^FTSE) fell 0.5%, while the pan-European Stoxx 600 (^STOXX) slipped 0.75%. Germany’s DAX (^GDAXI) dropped 1.89%, and Paris’s CAC (^FCHI) declined 2%.

Economic Takeaways –

• The July jobs report showed non-farm payrolls rose by just 73,000, far below the 100,000 gain economists had expected. Previous months saw major downward revisions: June job growth was slashed to 14,000 from 147,000, and May dropped to 19,000 from 125,000—highlighting a steadily weakening labor market.
• Bank stocks sank on concerns that a slowing economy could weigh on loan demand. JPMorgan Chase fell over 2%, while Bank of America and Wells Fargo each dropped more than 3%. GE Aerospace and Caterpillar also declined nearly 1% and 2%, respectively.
• The 10-year Treasury yield dropped to 4.22% on expectations that the Federal Reserve will need to cut rates in September to lift the economy.
• Weaker-than-expected jobs data boosted expectations that the Federal Reserve may cut interest rates sooner to support the slowing economy. Following the report, traders priced in an 86% chance of a September rate cut, according to CME Fed futures—up sharply from earlier in the week when Fed Chair Jerome Powell signaled a more cautious approach due to tariff-related inflation risks.
• Sentiment was further pressured by President Trump’s sweeping tariff hike rollout overnight. The new duties, ranging from 10% to 41%, include an additional 40% levy on transshipped goods. Canada, one of America’s top trading partners, will now face a 35% tariff, up from 25%.
• Tech stocks led Friday’s sell-off, with Amazon tumbling over 8% on weak forward guidance, and Apple sliding 2.5%. All three major indexes ended the week deep in the red: the S&P 500 fell 2.4%—its worst week since May 23; the Dow dropped 2.9%—its steepest weekly loss since early April; and the Nasdaq declined 2.2%.
• Consumer sentiment ticked up modestly in July, while inflation expectations eased further, according to the University of Michigan’s survey released Friday. The overall sentiment index rose to 61.7, a 1.6% monthly gain, though still 7.1% lower than a year ago and in line with expectations. Inflation projections showed continued improvement, with the one-year outlook dropping to 4.5% and the five-year falling to 3.4% — both at their lowest levels since February.

During Friday’s market downturn, 25 S&P 500 stocks hit new 52-week lows, reflecting deepening concerns across sectors.

Notable names included:

• Charter Communications, lowest since May 2024
• Chipotle Mexican Grill, lowest since November 2023
• Lululemon, lowest since April 2020
• Colgate-Palmolive, lowest since February 2024
• UnitedHealth, lowest since April 2020
• UPS, lowest since March 2020
• Accenture, lowest since March 2023
• Dow Inc, lowest since March 2020
• CarMax, lowest since December 2022
• Tyson Foods, lowest since February 2024

Meanwhile, seven S&P 500 stocks reached new 52-week highs:

• Altria (MO), highest since November 2018
• CBOE Holdings (CBOE), all-time high since its 2010 IPO
• ResMed (RMD), highest since September 2021
• Northrop Grumman (NOC), all-time high dating back to its 1994 merger
• American Electric Power (AEP), highest level since records began in 1972
• Evergy (EVRG), highest since August 2022
• Xcel Energy (XEL), highest since September 2022

Gold –

• Gold prices rose almost 2%, hitting a one-week high on Friday.
• Spot gold reached its highest level since July 25, adding 1.8% to $3,347.66 per ounce as of 0148 p.m. ET (17:48 GMT), after rising as much as 2% earlier today. Bullion was up 0.4% during the week.
• U.S. gold futures settled 1.5% higher at $3,399.8.
• “Payrolls numbers came in below expectations, but a little higher than the market was printing. So, this gives a better probability that the Federal Reserve will cut (rates) later in the year,” said Bart Melek, head of commodity strategies at TD Securities.

Oil –

• Oil sank after several poor US data and tariff announcements weighed on the prospects for energy demand growth.
• West Texas Intermediate crude fell 2.8% to settle near $67 a barrel on Friday, the biggest plunge in a single day since June 24.
• Traders expect OPEC+ to agree on another 548,000 barrels-a-day boost. The cartel is scheduled to meet this weekend.

Crypto –

• Bitcoin is hovering under $114,000.
• Core PCE, which excludes volatile food and energy prices, in June was up 0.3% on a monthly basis and 2.8% on an annual basis. The crypto market immediately dipped in reaction to the news.

Economists Weigh in on the Jobs Report and Why it was Bad

Markets were jolted Friday as investors digested a sharply weaker-than-expected July jobs report that economists say could mark a turning point in the Federal Reserve’s rate path—and the broader economic outlook.

The U.S. added just 73,000 jobs in July, well below the 104,000 expected, but the real shock came from downward revisions to the prior two months, which erased a combined 258,000 jobs—the largest two-month revision since May 2020.

“This report is a dud,” wrote Wells Fargo senior economist Sarah House, in a note bluntly titled ‘July and the No Good, Very Bad Jobs Report.’ She added: “The ‘solid’ state of the labor market described by the FOMC earlier this week looks more questionable after the July employment report,” citing widespread weakness across key cyclical sectors like manufacturing, retail, and professional services. While healthcare hiring remained a bright spot, House noted that “the pace [of job growth] has lurched lower to just 35K” over the past three months once revisions are factored in.

Steve Sosnick, chief strategist at Interactive Brokers, called the report “not good. There’s no way to sugarcoat that. The two-month revision is just staggering. It basically wipes out two months of what we thought were healthy job gains.”

Citi economist Veronica Clark echoed that concern, stating: “It’s not so much this July number, but the massive downward revisions to the June number that we had last month. … This definitely does look like a labor market that is weakening.”

Heather Long, chief economist at Navy Federal Credit Union, summed it up in one word: “Gamechanger.” She noted via X that “the labor market now looks a lot weaker than expected.”

The unemployment rate ticked up to 4.2%, in line with expectations, but Clark pointed to an additional red flag: “That happened despite the labor force participation rate falling more,” a dynamic some economists are linking to labor shortages exacerbated by President Trump’s immigration crackdown. Concerns had already been growing that mass deportations were reducing labor supply and keeping jobless figures artificially suppressed.

Markets wasted no time reacting to the data. The probability of a September Fed rate cut surged to 80%, up from 38% the day before, according to the CME FedWatch Tool. Leslie Falcone, head of taxable fixed income strategy at UBS Global Wealth Management, said the Fed’s next move is increasingly clear: “We still anticipate that the Fed starts to cut in September with consecutive cuts thereafter leading to about 100 basis points of cuts in total.”

Falcone emphasized how surprising the data was even to those expecting softening: “Some of these revisions are much more than what people expected. … I do think that this is a bit on the weaker side. And it does put cuts back on the table.”

Earlier this week, Fed governors Michelle Bowman and Christopher Waller dissented from the Fed’s decision to hold rates steady, citing weakening labor conditions—warnings that now appear prescient.

Markets reflected the sentiment. The Nasdaq (^IXIC) plunged more than 2%, the Dow (^DJI) fell nearly 600 points, and the S&P 500 (^GSPC) slid around 1.6% by midmorning. Treasury yields dropped sharply on rising rate-cut bets, with the 10-year yield (^TNX) falling 11 basis points to around 4.2%.

Fed Governor Kugler to Resign Aug. 8, Opening Door for Trump Pick

Federal Reserve Governor Adriana Kugler will step down on August 8, months ahead of her term’s January 2026 end, allowing President Trump to fill the seat early. The move gives Trump a chance to influence Fed policy sooner—possibly by nominating a candidate also in line to succeed Jerome Powell as chair next May.

Names floated include Kevin Hassett, Kevin Warsh, Scott Bessent, and current Governor Christopher Waller. Kugler’s exit comes amid increased pressure from Trump on the Fed to slash rates by 300 basis points. Recent dissents by Waller and Michelle Bowman, along with a soft July jobs report, have pushed the odds of a September rate cut to 80%.

Notables

• Figma (FIG) shares fluctuated throughout Friday’s session but ultimately closed up just over 5%, recovering from earlier losses. The gains followed a massive 250% surge in Thursday’s highly anticipated public market debut.
• Coinbase (COIN) shares sank 14%—its steepest intraday drop since April—after the crypto platform reported weaker quarterly revenue due to a decline in trading volume.
• Reddit (RDDT) shares jumped over 16% early Friday after the company beat Wall Street’s expectations for second-quarter earnings and revenue, while also offering an upbeat forecast for the third quarter.
• Shares of Novo Nordisk (NVO) and Eli Lilly (LLY) surged at the open following a Washington Post report that the Trump administration plans to pilot Medicare and Medicaid coverage for weight-loss medications.

What to Watch Ahead

Starting on Monday the focus shifts to June factory orders, along with earnings from companies across various sectors, including Tyson Foods (TSN), Hims & Hers Health (HIMS), Wayfair (W), and Palantir (PLTR).

A busy August 5 will feature the July ISM Services PMI alongside a flood of earnings from market heavyweights such as Pfizer (PFE), Caterpillar (CAT), BP (BP), Marriott (MAR), Duke Energy (DUK), DuPont (DD), Cummins (CMI), Yum! Brands (YUM), Advanced Micro Devices (AMD), Super Micro Computer (SMCI), Amgen (AMGN), Arista Networks (ANET), Opendoor Technologies (OPEN), Snap (SNAP), and Rivian Automotive (RIVN).

On August 6, attention turns to tech, transportation, and consumer names, with earnings on tap from Disney (DIS), Uber (UBER), Shopify (SHOP), AppLovin (APP), DoorDash (DASH), McKesson (MCK), Airbnb (ABNB), and Lyft (LYFT).

The week rounds out on August 7 with a first look at Q2 productivity and a final wave of earnings reports from companies including Eli Lilly (LLY), ConocoPhillips (COP), Constellation Energy (CEG), Becton Dickinson (BDX), Kenvue (KVUE), Warner Bros Discovery (WBD), Gilead Sciences (GILD), Block (XYZ), Expedia (EXPE), Wynn Resorts (WYNN), and Under Armour (UAA).