By Alex Eule

Friday Surprise. Stocks fell sharply Friday as renewed tariff fears overwhelmed markets. The Nasdaq Composite fell 3.6%, for its worst day since April 10, when, not coincidentally, the Trump administration's new global tariffs went into effect. Today's selloff wiped out a month's worth of gains.

The S&P 500 was down 2.7%, while the Dow Jones Industrial Average shed 879 points, or 1.9%.

Stocks actually opened the day in positive territory, but abruptly changed direction when, shortly before 11 a.m., President Donald Trump wrote a social media post expressing surprise about China's recent export controls around rare earth minerals. The moves "came out of nowhere," Trump wrote, and "I will be forced, as President of the United States of America, to financially counter their move."

The rhetoric quickly brought back the market's tariff trauma from earlier this year. Shortly after markets closed, Trump wrote: "Starting November 1st, 2025 (or sooner, depending on any further actions or changes taken by China), the United States of America will impose a Tariff of 100% on China, over and above any Tariff that they are currently paying."

Barring changes, that update will weigh on stocks at Monday's open. Nasdaq futures were down more than 1% this evening.

Today's moves had strategists reminding clients about the typically volatile performance for stocks in October.

"The cause was a surprise -- a flare up in trade relations with China -- but this time of year is an historically volatile one and with stocks priced-to-perfection coming into the month, it's no surprise that they could be knocked down from all-time highs," Chris Zaccarelli, chief investment officer for Northlight Asset Management, wrote.

As in the past, the U.S. and China could still find ways to work toward a detente. In her story today, my colleague Reshma Kapadia quotes 22V Research's Michael Hirson:

There is still a window to back down, and Trump faces significant political risks if he follows through on his threats -- loss of a TikTok deal, no hope of China buying U.S. soybeans, risks to U.S. auto and aerospace supply chains from China rare earth controls...And, of course, worries about U.S. markets and inflation.

The last time stocks were knocked off their perch by tariff fears, the S&P 500 fell 19% before rebounding to repeated highs in recent months. Time will tell if this time is different.

Watch our TV show on Fox Business Saturdays and Sundays at 9:30 a.m. and 10:30 a.m. ET. This week, Apollo chief economist Torsten Sløk on the re-escalation of trade tensions with China. Plus, a wild week for AMD.

The Hot Stock: PepsiCo +3.7% The Biggest Loser: Synopsys -9.4%

Best Sector: Consumer Staples +0.1% Worst Sector: Technology -4.1%

This Weekend's Magazine

The Calendar

Earnings season kicks into gear next week, with the government shutdown approaching a third week. The corporate results will give investors something to chew on, absent economic data from the federal government. The consumer price index, originally scheduled for release on Oct. 15, was going to be the main focus, but that has now been pushed back to Oct. 24, with the Bureau of Labor Statistics recalling some employees to collect data for the all-important report. The Social Security Administration needs inflation data to set its annual cost-of-living adjustment.

Financial-services firms make up the majority of S&P 500 companies reporting earnings next week, but two foreign tech firms at the heart of the artificial-intelligence ecosystem will also provide results.

Goldman Sachs Group, JPMorgan Chase and Wells Fargo announce results on Tuesday, followed by ASML, Bank of America, and Morgan Stanley on Wednesday. Charles Schwab and Taiwan Semiconductor Manufacturing release earnings on Thursday and American Express closes out the week on Friday.

-- Dan Lam

What We're Reading Today

   -- China Puts Trump in a Corner. Every Way Out Hurts. 
 
   -- A Hawkish Fed Official Is Rethinking His Stance on Rate Cuts 
 
   -- Bubble or Not, the AI Spending Binge Is Unprecedented in Every Way 
 
   -- Kalshi Is Valued at $5 Billion as the Prediction Market Goes Global 
 
   -- And this weekend's cover story: Larry Ellison's Latest Gambit to Keep 
      Oracle on Top Is His Biggest Bet Ever 

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Write to Alex Eule at alex.eule@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

October 10, 2025 18:21 ET (22:21 GMT)

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