Tariff announcement hits stocks; Indexes: Dow down 0.8 per cent, S&P 500 down 0.5 per cent, Nasdaq down 0.3 per cent.
US stocks ended lower on Friday, with indexes losing ground after the White House said US President Donald Trump will implement on Saturday tariffs of 25 per cent on Canadian and Mexican imports and 10 per cent on Chinese goods.
Investors have been bracing for further tariff news after Trump has repeatedly warned about using the measure. Uncertainty over the impact of tariffs has muddled the outlook for the economy and inflation.
"I would have thought the market would be down more," said Rick Meckler, partner at Cherry Lane Investments, a family investment office in New Vernon, New Jersey.
"It's not just the announcement itself, which I think probably impacts a select number of industries. It's whatever retaliation moves are taken."
Stocks turned lower on Friday afternoon after the White House said the tariffs against Canada, Mexico and China would take effect on Saturday.
Friday capped a heavy week of quarterly results from US companies as well. Apple shares ended down 0.7 per cent. They were higher early in the session after the company gave upbeat executive comments in its earnings on Thursday, in a sign it expects to recover from a dip in iPhone sales as it rolls out artificial intelligence features.
Energy led declines among S&P 500 sectors on Friday, with Chevron shares falling 4.6 per cent after the company reported fourth-quarter earnings below estimates and Exxon Mobil easing 2.5 per cent after its quarterly results.
The Dow Jones Industrial Average fell 337.47 points, or 0.75 per cent, to 44,544.66, the S&P 500 lost 30.64 points, or 0.50 per cent, to 6,040.53 and the Nasdaq Composite lost 54.31 points, or 0.28 per cent, to 19,627.44.
Indexes registered gains for the month of January, with the Dow up 4.7 per cent, the S&P 500 up 2.7 per cent and the Nasdaq up 1.6 per cent.
For the week, the Dow was up 0.3 per cent, but the S&P 500 declined 1.0 per cent and the Nasdaq fell 1.6 per cent. Tech shares sold off on Monday after Chinese startup DeepSeek unveiled a breakthrough in cheap AI models.
Early in Friday's session, economic data reinforced expectations that the Federal Reserve would keep interest rates unchanged for longer.
Reports showed strong US consumer spending and a moderate increase in inflation in December.
"Clearly, it makes total sense that the Fed didn't do anything this week, and it makes sense (Fed Chair) Jay Powell would say they're not in a hurry to lower rates," said Scott Wren, senior global market strategist at Wells Fargo Investment Institute in St. Louis, Missouri.
The Fed left rates unchanged in its policy announcement on Wednesday, and Powell said the US central bank wants to see further progress in inflation before cutting rates.
After the closing bell, Trump said he expects his administration to impose tariffs related to oil and gas around February 18. But he did not name a specific country to which the tariffs would apply or specify any more details about the plans.
Declining issues outnumbered advancers by a 2.3-to-1 ratio on the NYSE. There were 231 new highs and 54 new lows on the NYSE.
On the Nasdaq, 1,491 stocks rose and 2,913 fell as declining issues outnumbered advancers by a 1.95-to-1 ratio.
Volume on US exchanges was 15.78 billion shares, compared with the 15.5 billion average for the full session over the last 20 trading days.
