S&P 500 cuts losses, but trade uncertainty continues to weigh

Investing.com-- The S&P 500 cut losses in volatile Friday, as investors weighed a soft employment report and further trade uncertainty after President Donald Trump reportedly said he may impose reciprocal tariffs on Canada as soon as today.  

At 1:52 p.m. ET (18:52 GMT), the Dow Jones Industrial Average rose 143 points, or 0.2%, the S&P 500 index rose 0.3%, and the NASDAQ Composite added 0.2%. 

The main Wall Street indices are on track for weekly losses, with investors increasingly concerned the volatility surrounding the White House’s tariff policies will hamper consumer spending and add uncertainty to business decisions. 

Trump says reciprocal tariffs on Canada could start as soon as today

Trump on Monday said reciprocal tariffs on Canada could begin as soon as Monday, Bloomberg reported, well ahead of the previously announced April 2 deadline.The announcement stoked further uncertainty around trade and potential economic impact following a slew of tariff changes seen in this week. 

On Thursday, trump announced a temporary exemption for goods imported from Canada and Mexico under the United States-Mexico-Canada Agreement (USMCA), delaying the implementation of a 25% tariff until April 2. 

In response to the U.S. tariff announcements, Canada  decided to postpone a planned second wave of retaliatory tariffs on $125 billion worth of U.S. products until April 2. 

Powell signals need for longer pause on rates

Federal Reserve chairman Jerome Powell on Friday suggested the central bank may continue to take a patient approach on interest rates as the economy remains in good place despite elevated uncertainty.

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"We do not need to be in a hurry and we are well positioned to wait for clarity [on whether to adjust monetary policy]," Fed chairman Jerome Powell said Friday in prepared comments to the University of Chicago Booth School of Business’ US Monetary Policy Forum before level discussion

Weak payrolls add to tariff uncertainty 

The U.S. economy added fewer jobs than anticipated in February, while the unemployment rate accelerated slightly, in a potential sign of some labor market pressure.

This could factor in to how Federal Reserve officials determine the path ahead for interest rates.

Nonfarm payrolls for the month came in at 151,000, up from a downwardly-revised reading of 125,000 in January, data from the Labor Department’s Bureau of Labor Statistics showed on Friday. Economists had anticipated 159,000.

Meanwhile, the unemployment rate was 4.1%, above January’s pace of 4.0%.

Fed Chair Jerome Powell is also due to speak later in the session, and will provide almost real-time reaction to the figures.

Earnings continue to flow

In the corporate sector, Broadcom (NASDAQ:AVGO) stock rose more than 7% after the chipmaker assuaged investor worries about artificial intelligence infrastructure demand with a strong second-quarter forecast.

Hewlett Packard Enterprise (NYSE:HPE) stock slumped more than 14% after the AI-server maker said its annual profit forecast would be hit by U.S. tariffs in an intensely competitive market.

Gap (NYSE:GAP) stock surged 14% after the apparel company beat fourth-quarter sales and profit estimates, as the retailer’s turnaround strategy helped attract customers to its apparel brands including Old Navy and Banana Republic during the holiday quarter.

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Costco Wholesale (NASDAQ:COST) stock dipped almost 8% after the wholesale retailer reported lower-than-anticipated fiscal second-quarter profit, although revenues topped expectations, as consumers wary of the potential inflationary impact of U.S. tariffs turned to bulk-buying.

(Peter Nurse, Ayushman Ojha contributed to this article.)

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