U.S. stock futures declined by 0.4% for both the Dow Jones Industrial Average and the S&P 500 on Friday following President Donald Trump's accusations that China "
HAS TOTALLY VIOLATED ITS AGREEMENT WITH US" regarding tariffs. This statement came less than three weeks after the two largest economies agreed in Geneva to reduce tariffs significantly during a 90-day negotiation period, with the U.S. lowering levies from 145% to 30% and China from 125% to 10%.
Trump expressed his frustration on his Truth Social account, stating, "
I made a FAST DEAL with China in order to save them from what I thought was going to be a very bad situation" and lamented the breach of the preliminary accord without providing specific details.
The market reaction was compounded by mixed inflation data. The Federal Reserve's preferred inflation gauge, the core Personal Consumption Expenditures (PCE) index, rose 2.5% year-over-year in April, slightly down from 2.7% in March but still above the Fed's 2% target. The monthly core PCE inflation increased by 0.1%, as expected.
Despite the selloff, the broader market has shown resilience this month, with the Dow up 3.8%, the S&P 500 rallying 6.2%, and the Nasdaq surging 9.9%. However, the recent tariff tensions have introduced uncertainty, with Art Hogan, chief market strategist at B Riley Wealth, noting, "
We went from a place where it felt as though investors had a pretty good handle on the direction of trade and tariffs and now that picture has become very confusing."
Overall, the market remains volatile as investors weigh the implications of renewed trade tensions against easing inflation pressures, with the Nasdaq on track for its best month since November 2023 and the S&P 500 poised for its biggest monthly gain since November 2024.
Sources: 
U.S. stock futures fell 0.4% Friday after President Trump accused China of violating a recent tariff agreement, escalating trade tensions. The Dow Jones and S&P 500 futures dropped amid mixed inflation data, with the Fed's core PCE inflation at 2.5%, while markets remain volatile amid trade uncertainty.
