The US stock market experienced a downturn over the past week ending August 2, 2025, influenced by weak labor market data and concerns over new tariffs. Major indices saw notable declines amid heightened volatility.

Key indices performance: The S&P 500 fell by approximately 2.47%, closing around 6238 points after a 1.60% drop on August 1. The Nasdaq Composite decreased by about 2.44%, while the Dow Jones Industrial Average dropped by roughly 2.88%. These movements reflect broader market pressures from economic indicators and policy announcements.

Major market movers included strong performers like Reddit (RDDT) and Wingstop (WING), which surged on positive developments, alongside Generac Power Systems (GNRC), Alnylam Pharmaceuticals (ALNY), and Chart Industries (GTLS). Conversely, sectors such as Basic Materials and Consumer Stocks saw sharp declines, with Novo Nordisk sliding amid the broader sell-off.

Significant earnings releases last week featured reports from major companies, including anticipation around the Magnificent Seven (Mag-7) tech giants. Highlights included Alphabet (GOOGL) and Tesla (TSLA) from recent sessions, with mixed results contributing to market sentiment. Other notable earnings came from companies like IBM, ServiceNow (NOW), and Chipotle (CMG), influencing sector-specific movements.

Key economic events included a stronger-than-expected Q2 GDP growth of 3%, beating forecasts of 2.3%. However, this was overshadowed by disastrous labor market data, with rising jobless claims and weaker manufacturing and services PMIs. Additionally, looming August 1 tariffs added to investor uncertainty, prompting a rally in US Treasuries and gold.

Overall, the week was marked by a shift towards defensive assets, with Utilities as the best-performing sector and Materials as the worst. Market participants are now eyeing upcoming Federal Reserve decisions and further earnings reports.