US stocks declined on Friday, with a cooler-than-expected jobs report and rising inflation expectations capping a volatile week marked by concerns over a trade war. The benchmark S&P 500 remained about 1% below record-high levels, even as stocks were whipsawed this week by headlines over President Donald Trump's plans to impose tariffs on the largest US trading partners.
The jobs data missed expectations, but Wall Street's three main indexes initially rose. They quickly fell into the red, however, after separate data showed US consumers now expect inflation to jump. Employment and inflation are what the US Federal Reserve takes into account when setting interest rates.
President Trump's remarks on unspecified "reciprocal tariffs" also appeared to reignite concerns. Trump said at a press conference with Japanese Prime Minister Shigeru Ishiba that he was "probably meeting on that Monday or Tuesday," saying that this would be "opposed to a flat-fee tariff" approach.
The Fed kept its rate unchanged last week, with Chair Jerome Powell saying the central bank was in no "hurry" to adjust borrowing costs again.
Total US employment rose by 143,000 jobs last month, said the Labor Department, significantly lower than the revised 307,000 figure in December. The January figure was also below an analyst consensus estimate of 155,000.
But data released afterward subsequently showed US consumer sentiment fell to its lowest level in July, with survey respondents reporting feeling less confident and more concerned about inflation. Year-ahead inflation expectations rose to 4.3 percent, up a full percentage point from a month earlier.
The jump in inflation expectations follows a turbulent week for stock markets and currencies after Trump imposed tariffs on China. The US leader also warned that the European Union would face tariffs "pretty soon" while he delayed duties on Canada and Mexico at the 11th hour.
In Frankfurt, Porsche shares slumped after the luxury carmaker's forecasts for the year ahead disappointed expectations. Gold was another shining performer this week, reaching a new all-time peak as the precious metal profits from its status as a haven investment.
Hong Kong and Shanghai stock markets closed solidly higher thanks to gains across technology firms. Chinese startup DeepSeek has shaken up the race for AI supremacy, spooking US tech companies.
Tokyo stocks were weighed by a stronger yen, which picked up this week after Bank of Japan board member Naoki Tamura said he wanted borrowing costs to increase.
Key figures around 2145 GMT:
New York - Dow: DOWN 1.0 percent at 44,303.40 points (close)
New York - S&P 500: DOWN 1.0 percent at 6,025.99 (close)
New York - Nasdaq Composite: DOWN 1.4 percent at 19,523.40 (close)
London - FTSE 100: DOWN 0.3 percent at 8,700.53 (close)
Paris - CAC 40: DOWN 0.4 percent at 7,973.03 (close)
Frankfurt - DAX: DOWN 0.5 percent at 21,787.00 (close)
Tokyo - Nikkei 225: DOWN 0.7 percent to 38,787.02 (close)
Hong Kong - Hang Seng Index: UP 1.2 percent to 21,133.54 (close)
Shanghai - Composite: UP 1.0 percent to 3,303.67 (close)
Euro/dollar: DOWN at $1.0328 from $1.0387 on Thursday
Pound/dollar: DOWN at $1.2405 from $1.2436
Dollar/yen: DOWN at 151.43 yen from 151.47 yen
Euro/pound: DOWN at 83.24 pence from 83.50 pence
Brent North Sea Crude: UP 0.5 percent at $74.66 per barrel
West Texas Intermediate: UP 0.6 percent at $71.00 per barrel