U.S. and European Markets React to Trump’s Tax Measures and Economic Data
The Dow Jones Industrial Average (DJIA) closed down 337.47 points,or -0.75%, on January 31, 2025, as markets reacted to president trump’s declaration of new tax measures targeting imports from Canada, Mexico, and China.The S&P 500 and news.
Despite the weekly declines, the Dow Jones outperformed in January, rising 4.7%, while the S&P 500 and NASDAQ gained 2.7% and 1.6%,respectively.however, the energy sector dragged down the S&P 500, with Chevron and Exxon Mobil shares dropping 4.6% and 2.5% after disappointing quarterly results.
Economic data released on Friday reinforced expectations that the Federal Reserve (Fed) will maintain current interest rates. The Personal Consumption Expenditures (PCE) index, a key inflation gauge, rose 2.6% year-over-year in December, aligning with analyst forecasts. The Core PCE index, excluding food and energy, increased by 2.8%, also in line with expectations.
Scott Ren, a global marketing strategist at Wells Fargo Investment Institute, noted, “It was very reasonable that the Fed didn’t do anything this week. Fed Chair Jerome Powell made it clear that they are not in a hurry to reduce interest rates.”
Simultaneously occurring, European markets closed at record highs, led by technology and healthcare stocks. The
