Black Friday On Wall Street

On Friday, August 1, 2025, U.S. markets plunged in one of their worst days since May, spurred by a combination of a poor jobs report and President Trump’s sweeping new tariff announcement .

The S&P 500 fell 1.6%, the Dow Jones dropped 1.2% (~542 points), and the Nasdaq plunged 2.2% (~472 points) . Small‑cap equities did even worse—the Russell 2000 lost 2% on the day and over 4.2% during the week .

The catalyst: a July non‑farm payroll report that added just 73,000 jobs, significantly below estimates, along with downward revisions lowering May and June by a collective 258,000 jobs . These weak data amplified fears of a decelerating U.S. economy and triggered speculation around an interest‑rate cut as early as September .

At the same time, the administration announced new tariffs—ranging from 10% to 41%—on imports from numerous countries (Canada, India, Brazil, Taiwan, Switzerland), set to take effect on August 7 . This dashed market hopes for a softer stance, puncturing the so‑called “TACO trade” (Trump Always Chickens Out) optimism .

Investor response was swift: U.S. Treasury yields fell as bond prices surged, signaling a flight to safety and reinforcing concerns of an upcoming slowdown . The CBOE VIX volatility index spiked to multi‑week highs ﹘ a stark warning sign of heightened market stress .

In short, Friday’s rout was not just a blip. It reflected mounting economic headwinds, fading confidence in trade policy moderation, and growing pressure on the Federal Reserve to pivot—possibly as soon as September. With global trade tensions intensifying and employment trends weakening, markets are bracing for volatility to persist.