United States: Daily Stock Market Performance Insight - August 29, 2025

Today was a down day for the stock market as investors took some profits ahead of the long weekend and awaited key inflation data. The S&P 500 fell 0.6%, closing at 6,489.28. The Dow Jones Industrial Average dipped 0.2% to 45,590.96, and the Nasdaq Composite saw a larger drop of 1.2% to 21,630.326.

Inflation Concerns are Key: The biggest driver of today’s mood is inflation. The Personal Consumption Expenditures (PCE) index, a key measure watched by the Federal Reserve, remained at 2.6% year-over-year in July, matching June’s reading. However, the core PCE – excluding food and energy – actually *increased* to 2.9%, the highest since February. This is making investors nervous about how quickly the Fed will cut interest rates. While a rate cut in September is still anticipated, lingering inflation could delay further cuts, potentially pushing them out to late 2026.

Tariffs and Global Growth Add Pressure: Adding to the concerns, the US ended a tariff exemption allowing packages under $800 to enter tariff-free. The Congressional Budget Office estimates this will generate an extra $23 billion in tariff revenue over the next decade. This, combined with a weakening outlook in Denmark – their 2025 growth forecast was cut from 3% to just 1.4% – suggests a slowing global economy.

Political Risks and Company-Specific News: Political uncertainty is also weighing on the market, with President Trump’s criticism of the Federal Reserve raising concerns about its independence. This could lead to higher long-term inflation and reduced investor confidence. On the company front, Nvidia, a major player making up 7-8% of the S&P 500, fell 3.3% despite positive analyst outlooks, and Dell slid 8.9% even after beating revenue expectations due to margin pressures. Prologis did declare a dividend of $1.01 per share, offering a positive note for stockholders.

What to Expect Tomorrow: With the market already reacting to inflation data, tomorrow’s trading might be quieter due to the holiday weekend. However, keep an eye on how investors interpret the latest PCE numbers. If inflation remains a concern, expect continued caution and potentially more downside pressure on stocks. Mortgage rates remain elevated, averaging 6.54% for a 30-year fixed, and aren’t expected to drop significantly even with a potential rate cut.