Market Turbulence: AI Stocks Plummet Amid Tariff Woes

The S&P 500 fell due to declines in Dell, Nvidia, and other AI stocks, influenced by rising manufacturing costs and tariff pressures. Inflation showed increased consumer spending, while expectations of interest rate cuts remained. U.S. stock markets will close for Labor Day, with tech and tariff issues central to investor concerns.

The S&P 500 experienced a downturn on Friday, driven by declines in AI-focused stocks such as Dell and Nvidia. While Dell dropped by 9.4% due to rising manufacturing costs and strong competition, Nvidia's value decreased by 3.3%, marking its third consecutive day of losses.

Despite strong domestic consumer spending, U.S. inflation data indicated pressures from tariffs on imports. However, experts suggest that these might be temporary, anticipating the Federal Reserve will still opt to cut interest rates by 25 basis points in September.

In contrast, Alibaba's shares soared 13% following impressive growth in its cloud computing sector. Meanwhile, minor judicial proceedings saw no ruling on Trump's attempt to dismiss a Federal Reserve governor. The markets are set to close on Monday for the Labor Day holiday.

(With inputs from agencies.)