Dow Tumbles Over 700 Points Amid Tariff Concerns: Investor Sentiment Declines, Greed Index Moves To 'Extreme Fear' Zone

The CNN Money Fear and Greed index showed a decline in the overall market sentiment, while the index moved to the “Extreme Fear” zone on Friday.

U.S. stocks settled lower on Friday, with the Dow Jones index falling more than 700 points during the session as investors assessed recent tariff-related news.

Earlier on Friday, the Fed’s favorite inflation gauge – the core Personal Consumption Expenditure price index – rose 2.8% on an annual basis in February, surprising estimates of 2.7%.

Investor anxiety deepened following the latest University of Michigan Survey of Consumers, which showed 5-year forward inflation expectations jumping to 4.1%, a 0.2-point increase from prior estimates and the highest reading since February 1993.

AAR Corp. AIR shares dipped over 16% on Friday after the company reported a third-quarter sales miss.

Most sectors on the S&P 500 closed on a negative note, with consumer discretionary, communication services, and information technology stocks recording the biggest losses on Friday. However, utilities stocks bucked the overall market trend, closing the session higher.

The Dow Jones closed lower by around 716 points to 41,583.90 on Friday. The S&P 500 fell 1.97% to 5,580.94, while the Nasdaq Composite tumbled 2.70% to 17,322.99 during Friday's session.

Investors are awaiting earnings results from PVH Corp. PVH, Progress Software Corporation PRGS, and Babcock & Wilcox Enterprises, Inc. BW today.

What is CNN Business Fear & Greed Index?

At a current reading of 21.9, the index moved to the “Extreme Fear” zone on Friday, versus a prior reading of 28.5.

The Fear & Greed Index is a measure of the current market sentiment. It is based on the premise that higher fear exerts pressure on stock prices, while higher greed has the opposite effect. The index is calculated based on seven equal-weighted indicators. The index ranges from 0 to 100, where 0 represents maximum fear and 100 signals maximum greediness.

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