Stock Market Volatility Climbs Amid Inflation Concerns and Tariff Policies

The U.S. stock market is on edge ahead of a critical inflation report, further unnerved by growth slowdown fears and tariff uncertainties. Investors are grappling with policy changes and potential Federal Reserve interest rate decisions. An elevated CPI report could signify prolonged market volatility and raise stagflation concerns.

The U.S. stock market braces for turbulence as investors await a significant inflation report due next week. Concerns over economic growth slowdown and President Donald Trump's erratic tariff policies have already rattled investor confidence. Despite a minor recovery on Friday, the S&P 500 suffered its worst week in half a year.

The Nasdaq Composite has entered a correction phase, impacted by global policy shifts and trade tensions involving Mexico, Canada, and China. A hotter-than-expected consumer price index (CPI) report this Wednesday could derail hopes for more Federal Reserve interest rate cuts this year.

Heightened inflation could stall easing views initially computed by investors, warns Bryant VanCronkhite of Allspring Global Investments. With job market instability and legislative gridlock over a spending bill, economic uncertainty is poised to maintain high volatility levels, affecting decision-making in corporate and consumer sectors.

(With inputs from agencies.)