The New York Stock Exchange closed the day with a decrease, with the Dow Jones index falling by 0.45% to 43,209.50 points. The S&P 500 index dropped by 1.59% to 5,861.57 points, while the Nasdaq index saw a 2.78% decline to 18,544.42 points.

Concerns about deepening trade wars due to US President Donald Trump’s tariff policy were noted to keep investors cautious. Investors closely followed Nvidia’s financial results and macroeconomic data. Trump had stated that they would not halt tariffs on Canada and Mexico, deciding instead to impose a 25% tariff on the European Union, with details to be announced soon. Trump also announced that tariffs on Mexico and Canada would take effect on March 4th, with an additional 10% tariff on China on the same date. The US economy grew by 2.3% in the fourth quarter of 2024, in line with expectations. Core personal consumption expenditure price index, excluding food and energy expenses, was revised from 2.5% to 2.7% during that period. Initial jobless claims in the US exceeded market expectations by reaching 242,000. Durable goods orders in the country increased by 3.1% in January, surpassing expectations. Pending home sales in the US recorded a higher-than-expected decrease of 4.6% in January. Despite high inflation indicators, it was mentioned that the resilience of the US economy continued. The yield on the US 10-year Treasury bond increased by 2 basis points to 4.27%.

NVIDIA STARTED RISING, CLOSED WITH LOSSES Nvidia’s revenue reached $39.3 billion on an annual basis, a 78% increase. The company’s net profit rose by 80% annually to $22.1 billion. Nvidia exceeded market expectations with its revenue and profit while announcing its revenue expectation for the current quarter at $43 billion. Analysts indicated that Nvidia’s optimistic forecasts alleviated concerns about cooling demand in the sector following the disruption caused by the Chinese startup DeepSeek’s artificial intelligence model. However, Nvidia’s shares closed the day with an 8.5% loss after initially rising. Kansas City Fed President Jeff Schmid mentioned the flaws in survey measurements for inflation expectations. He stated that while inflation had reached the highest level in the last 40 years, it was not the time for the Fed to lower its guard. Schmid pointed out the upward risks associated with inflation and the growing uncertainties that could put pressure on growth. He emphasized the importance of the Fed remaining vigilant and maintaining the credibility it had difficulty gaining.

EVALUATIONS BY FED CHAIRMEN Cleveland Fed President Beth Hammack indicated that the disinflation process was irregular and slowing down. She expressed her belief in the luxury of patience for monetary policy, which would likely mean keeping the federal funds rate steady for some time. Hammack mentioned that as long as the labor market remains healthy, she was looking for evidence that inflation had returned to a sustainable 2% level before adjusting policy. She discussed the upward risks to the inflation outlook. Hammack believed that monetary policy was not significantly restrictive and could currently be close to a neutral environment. Philadelphia Fed President Patrick Harker said that the policy interest rate would continue to be restrictive enough in the long term to exert downward pressure on inflation without adversely affecting the rest of the economy.