US stocks sold off on Friday, marking the worst day of 2025 just two days after the S&P 500 hit a record high.
Economic data releases raised concerns about a rebound in inflation.
The Dow Jones has lost 1,200 points over the past two days.
US stocks sold off on Friday in their worst day of 2025, just two days after the S&P 500 closed at a record high.
The Dow Jones Industrial Average shed more than 700 points, bringing its two-day loss to 1,200 points.
The decline on Friday accelerated following a trio of economic data releases early in the trading session, which painted a worrying picture about the current state of the economy, consumers, and inflation.
The dynamics added to investors’ fears of higher interest rates, compounding the Federal Reserve’s continued messaging that it is in no rush to cut interest rates until inflation moves lower.
Here’s the data trifecta that hit stocks:
Consumer sentiment plunged in February for the second consecutive month, as measured by the University of Michigan’s survey. Fears of tariffs from the Trump administration and expectations for a rebound in inflation sent the index to 64.7 in February, its lowest level since November 2023.
Existing home sales in January declined to 4.08 million, well below analyst estimates of 4.29 million.
«Existing home sales offered little hope for a real estate recovery as elevated financing charges and costly properties are hampering affordability for prospective buyers,» Jose Torres, senior economist at Interactive Brokers said.
Lastly, US services as measured by the Purchasing Managers Index unexpectedly contracted. S&P flash U.S. services PMI dropped to 49.7 in February, well below consensus estimates of 52.9 and below December’s reading of 52.8.
«This morning’s data … featured the first contraction in services activity in over two years, a significant development considering that the pivotal area comprises roughly 70% of the US economy,» Torres said.
Here’s where US indexes stood at the 4 p.m. closing bell on Friday:
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