Post by : Jyoti Gupta

Photo:AP

On Friday, August 1, 2025, stock markets in the United States had a very bad day. The prices of many stocks fell sharply, with the S&P 500 seeing its biggest drop in more than two months. Investors were worried because the U.S. government announced new taxes, called tariffs, on products coming from countries like Canada, Brazil, India, and Taiwan. These taxes were ordered by President Donald Trump just a few hours before the deadline.

At the same time, a government report showed that fewer new jobs were added in July than people expected. The report also said that the number of jobs added in the month before was actually lower than first reported. This made many people feel unsure about the strength of the U.S. economy. When people feel uncertain, they often sell their stocks, which causes the market to fall even more.

Amazon’s stock also dropped by 8.3%, one of its biggest one-day losses recently. Even though the company shared its latest earnings report, many investors were not happy with the performance of its cloud service division, Amazon Web Services. This big drop in Amazon’s stock had a huge impact on the overall market because Amazon is one of the biggest companies in the U.S.

Another well-known company, Apple, also saw its stock price go down by 2.5%. Even though Apple gave a strong forecast for the next quarter, the CEO warned that the new tariffs from the U.S. government could increase Apple’s costs by $1.1 billion.

The job report made investors believe that the Federal Reserve — the central bank of the United States — will probably lower interest rates at its next meeting in September. When the economy shows signs of slowing down, the Fed often cuts interest rates to help boost growth. According to a popular financial tool, the chance of a rate cut went up to 86.5% from just 37.7% the day before.

The stock numbers for the day were not good:

• The Dow Jones Industrial Average fell by 542.40 points, or 1.23%, ending at 43,588.58.
• The S&P 500 dropped by 101.38 points, or 1.60%, to finish at 6,238.01.
• The Nasdaq Composite lost 472.32 points, or 2.24%, ending at 20,650.13.

This was the worst day for the S&P 500 since May 21 and the worst for the Nasdaq since April 21. For the whole week, the S&P 500 dropped by 2.36%, the Nasdaq fell by 2.17%, and the Dow dropped the most with a 2.92% loss.

Wall Street’s “fear gauge,” called the Volatility Index, went up to 20.38, which is its highest point since June 20. This shows that people are nervous about the future of the economy.

To add more pressure, President Trump publicly announced that he fired the head of the U.S. Bureau of Labor Statistics, Erika L. McEntarfer, after seeing the disappointing job numbers. This shocked many people. Some experts said this type of action is unusual and not something seen in healthy democracies.

Also, there was news that Federal Reserve Governor Adriana Kugler is stepping down from her position early. She will leave on August 8. This gives Trump a chance to pick someone new to join the Fed — at a time when he’s already pushing hard for interest rate cuts and putting pressure on Fed Chair Jerome Powell.

On the stock market, more companies saw their shares go down than up. On the New York Stock Exchange, losing stocks outnumbered rising ones by more than 2 to 1. On the Nasdaq, the number was closer to 3 to 1. There were very few companies hitting new highs, while many hit new lows.

Trading volume was also heavy, with more than 19.5 billion shares being exchanged on U.S. exchanges — more than the usual average.