US stocks headed lower on Friday as investors absorbed a fresh wave of tariff uncertainty and a cooldown in inflation pressures, according to the Federal Reserve's preferred price gauge.
The benchmark S&P 500 ( ^GSPC ) fell 0.4%. The tech-heavy Nasdaq Composite ( ^IXIC ) slipped roughly 0.7%, while the blue-chip Dow Jones Industrial Average ( ^DJI ) fell 0.2% after the major gauges ended Thursday in the green .
President Trump on Friday ratcheted up tensions with China, claiming it has "totally violated its agreement with us" less than three weeks after the world's two largest economies reached a tariff detente.
Trade talks between the US and China are "a bit stalled," Scott Bessent told Fox News on Thursday. The Treasury Secretary said a call between Trump and President Xi is needed to reach a deal, as the two countries continue to clash over chip curbs and visas on the sidelines.
The China escalations came after the tariffs faced a bout of legal drama — a new source of uncertainty. On Thursday, a US appeals court on Thursday paused a trade court block on Trump's global tariffs, giving the White House until next Monday to file a challenge to the ruling. At the same time, his team is exploring other ways to issue the tariffs .
Read more: The latest on Trump's tariffs
Meanwhile, inflation continued cooling in April, according to the latest reading of the Personal Consumption Expenditures (PCE) index. The "core" PCE index, closely watched by the Fed, rose in line with expectations on a monthly and annual basis.
Though May has been filled with trade-war switchbacks, US stocks are on track to close the month out on Friday with hefty gains . The S&P 500 is eyeing a jump of over 6%, the Dow, a rise of about 4%. The Nasdaq Composite is headed for a surge of almost 10% as tech stocks revive. The gauges are set for a winning week too.
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