Wall Street’s main indexes were set for weekly declines on Friday, as fresh data painted a weak picture for the American economy, while UnitedHealth dropped after a report that the Justice Department is investigating the healthcare conglomerate.
In afternoon trading, the Dow Jones Industrial Average slumped 704 points, or 1.6%, to 43,472. The S&P 500 dropped 1.4%, and the Nasdaq lost 1.7%.
All three main indexes are set for weekly declines despite the S&P 500 hitting record highs twice earlier this week. The blue-chip Dow was on pace for its worst weekly slide since early January.
Data published by S&P Global showed US business activity nearly stalled in February amid mounting fears over tariffs on imports and deep cuts in federal government spending.
“Companies report widespread concerns about the impact of federal government policies, ranging from spending cuts to tariffs and geopolitical developments,” said Chris Williamson, chief business economist at S&P Global Market Intelligence.
Another survey by the University of Michigan showed US consumer sentiment dropped more than expected in February to a 15-month low and inflation expectations rocketed.
“There are signs that the economy might be slowing, and combine that with the fears of the unknown of the tariffs, it’s leading to somewhat of a pullback in the market,” said Peter Cardillo, chief market economist at Spartan Capital Securities.
The Dow Jones Transport Average – often noted as gauge to measure the strength of the economy – slumped 2.4% and was on track for its worst single-day drop this year.
UnitedHealth slid 9% after the Wall Street Journal reported that the Justice Department has launched an investigation into the company’s Medicare billing practices in recent months.
Shares of other health insurers were also hit, with CVS Health down 2.3% and Humana losing 4.6%.
Retail giant Walmart’s dour forecast on Thursday, along with jitters around President Trump’s tariff threats and uncertainty over the Federal Reserve’s interest rate outlook, have pinned equities lower this week.
Earlier this week, Trump said he will announce fresh tariffs over the next month or sooner, adding lumber and forest products to previously announced plans to impose duties on imported cars, semiconductors and pharmaceuticals.
The Personal Consumption Expenditures (PCE) reading, the Fed’s preferred gauge for inflation, would be on the radar next week, along with AI-darling Nvidia’s quarterly earnings.
Block tumbled 15% after the payment firm’s fourth-quarter profit fell short of estimates.
Akamai Technologies dropped 16.2% as the cybersecurity company forecast annual 2025 revenue below estimates.
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