The New York stock exchanges closed significantly lower on Friday as investors digested new data from market researcher S&P Global showing that US business activity nearly stalled in February.
A University of Michigan survey also showed a sharper-than-expected decline in US consumer confidence this month.
S&P Global noted that companies are increasingly concerned about US government policies such as budget cuts and import tariffs. US consumers also expect prices to rise by an average of 3.5% annually over the next five to ten years, the highest rate since 1995, according to Bloomberg.
Market economist Peter Cardillo of Spartan Capital Securities told Reuters news agency that there were signs that the economy might be slowing, and combined with the fear of the unknown regarding tariffs, these were leading to a certain market pullback.
The Dow Jones Industrial Average lost 1.7%, closing at 43,428.02 points. The broad S&P 500 dropped 1.7% to 6,013.13 points, while the tech-heavy Nasdaq fell by 2.2% to end on 19,524.01 points.
UnitedHealth sank 7.2% after The Wall Street Journal reported that the US Department of Justice had launched an investigation into the health insurer’s billing practices. CVS Health also dipped, losing 2.5%.
Booking Holdings dropped 0.6% despite opening higher. The company behind the website Booking.com reported that it benefited from a busy holiday season in the fourth quarter, with profits exceeding expectations. However, it warned that the strong US dollar would have a negative impact on future results.
Tesla shares fell by 4.7%. The Financial Times reported on Friday that the electric car manufacturer was interested in acquiring US factories from the struggling Japanese automaker Nissan. Later in the day, regulator NHTSA announced that Tesla had to recall over 376,000 cars in the US to fix power-steering issues.
