Stocks Shake as US-China Trade Tensions Flare Up Again

Markets Reel from Trump's Accusations Against China

Hold onto your hats, folks! Stocks were all over the place on Friday as the latest round of trade tension between the US and China sent shockwaves through the markets. Investors were on edge, and you could feel the uncertainty in the air.

President Trump dropped a bombshell, claiming that China had violated their trade agreement, and that sent investors into a frenzy. Meanwhile, a key US inflation gauge cooled down in April, but that wasn't enough to calm the nerves of those watching the markets.

The Dow Jones took a hit, dropping over 120 points, while the S&P 500 shed 0.6%. It was a wild ride, and the Nasdaq Composite couldn't escape the drama either, opening 0.4% down after a positive close on Thursday, thanks to gains from global chip giant Nvidia.

Friday brought some interesting data on the table. April's core Personal Consumption Expenditures index, which the Federal Reserve keeps a close eye on, rose 2.5% annually. That's the lowest reading since March 2021, and it met economists' expectations. The overall PCE rose 2.1% yearly, a bit lower than what the experts were predicting, while core prices stayed steady at 0.1%.

Now, you might think that a softer inflation reading would be great news for risk assets like stocks and cryptocurrencies, but the fresh tariffs uncertainty is weighing heavily on investor sentiment.

This whole mess started when President Trump accused China of totally violating their trade agreement. Treasury Secretary Scott Bessent even said that the US-China trade talks were "a bit stalled." Talk about a rollercoaster!

Trump took to Truth Social to vent, saying he made a "FAST DEAL" with China to save them from a bad situation. He thought everyone was happy, but now he's calling out China for breaking their agreement. "So much for being Mr. NICE GUY!" he wrote.

Brace yourselves, because there's more tariff drama on the horizon. The US appeals court put a pause on the Court of International Trade's ruling on Trump's global tariffs, and the White House is ready to take it all the way to the Supreme Court. Experts are warning that blocking most of the tariffs could blow a $2 trillion hole in Trump's fiscal plan.

Despite all this chaos, US stocks are still looking at a green monthly close. The Nasdaq is set to spike 10% over the month, while the S&P 500 is on track for a 6% jump. The Dow could end May 4% higher. It's been a wild ride, but the markets are holding strong in the face of uncertainty.