It’s been a cautious week on Wall Street as earnings from mega-cap tech companies prompted investors to reassess their high expectations for future growth.
Google parent Alphabet and Amazon.com were the latest among Magnificent Seven stocks to fall short of lofty guidance forecasts, weighing on the broader market. Drugmaker Eli Lilly and financial stocks provided a cushion, helping offset some of the weakness in mega-cap tech.
Mixed jobs news
On the macroeconomic front, January’s labor market data sent mixed signals. Nonfarm payrolls rose by 143,000, a sharp slowdown from December’s 307,000 and well below economist forecasts of 170,000. Yet the unemployment rate edged lower and wages grew at a faster-than-expected pace.
Gold gains again
Gold surged to new all-time highs as investors sought protection against inflation and policy uncertainty. The precious metal repeatedly broke above $2,850 per ounce, marking its sixth consecutive week of gains and reinforcing its status as the go-to safe-haven asset amid an environment of economic risks.
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Gaza and Iranian oil
Geopolitical developments also shaped market sentiment. During a meeting with Israeli Prime Minister Benjamin Netanyahu, U.S. President Donald Trump outlined a new vision for Gaza, suggesting the United States could “take over” and transform it into the “Riviera of the Middle East” while relocating Palestinians to Jordan and Egypt.
The U.S. Treasury announced fresh measures aimed at sanctioning Iran’s oil export network to China as part of Washington’s broader strategy to exert “maximum economic pressure” and prevent Iran from advancing its nuclear program.
On Friday, Reuters, citing unnamed sources, reported that Trump informed lawmakers of his plans to announce reciprocal tariffs on many countries, though which ones was not known.
More:Stocks recover after new cost-effective AI platform sparked a sell-off
Ford EV losses
Ford’s fourth-quarter earnings of $10.2 billion beat expectations, but its weak 2025 outlook and projected $5.1 billion loss in the electric vehicle segment sent the stock to the lowest level since January 2021. Analysts remained cautious, citing profitability concerns and competitive pressures in the EV market.
Consumers see trouble ahead
A warning sign emerged Friday when the University of Michigan’s consumer sentiment index revealed an unexpected decline in February, with the report highlighting an “unusually large” increase in year-ahead inflation expectations. The survey attributed much of this anxiety to higher tariffs under the Trump administration.
Specifically, U.S. consumer sentiment fell to 67.8 in February, per the survey, missing forecasts. Inflation expectations rose to 4.3%, the highest since November 2023.
Benzinga is a financial news and data company headquartered in Detroit.
