The S&P 500 index eased 0.3% last week as the Trump administration unveiled plans for new tariffs on pharmaceuticals, trucks and furniture. With two trading sessions remaining in September, the S&P is up 2.8% for the month and 13% this year.
President Trump said the U.S. will impose tariffs of 25% on heavy trucks and 50% on kitchen cabinets and bathroom vanities, effective Wednesday. Additionally, the U.S. will charge 100% levies on branded or patented pharmaceutical products.
The new tariffs added to investors’ inflation concerns. Earlier last week, Fed Chair Jerome Powell said policymakers face a “challenging situation,” with near-term risks to costs tilted to the upside and those to employment leaning downside.
The annual headline personal consumption expenditures price index advanced 2.7% last month, compared with 2.6% growth in July, but met market expectations. The Fed’s preferred core measure, which excludes food and energy, held steady at 2.9% in August and also met consensus expectations.
By sector, communication services had the largest drop of the week, falling 2.7%, followed by a 2% decline in materials and a 1.2% slip in consumer discretionary. Consumer staples, health care and financials also moved lower.
Meanwhile, the energy sector rose 4.7%, followed by a 2.8% gain in utilities and a 0.9% advance in real estate. Technology and industrials edged higher.
Economic data expected this week includes September payrolls and unemployment on Friday.
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