US stocks traded sharply lower on Friday, with the S&P 500 down 1.4%, the Nasdaq falling 1.9%, and the Dow Jones sinking 500 points, as investors continue to weigh the impact of new tariffs while digesting the latest PCE report.

Core PCE prices rose 0.4% on the month, above forecasts, pushing the annual rate higher to 2.8%, in a sign of rising price pressures. Also, personal spending increased less than expected. Meanwhile, fresh reciprocal tariffs are set to take effect next week. Consumer discretionary was by far the worst performer while the utilities sector outperformed.

Megacaps were mixed, with Apple (-0.5%), Microsoft (-0.4%), Amazon (-1.1%), Meta (-0.4%) and Alphabet (-0.6%) trading in the red while Tesla shares were little changed and Nvidia gained more than 1%. On the week, the three major averages are on track to book small gains, a second straight winning week. The Dow is up 0.8% so far, the S&P 500 added 0.5% and the Nasdaq edged up 0.1%.

Source: Trading Economics