Dow Jones Slumps as Consumer Sentiment Wanes, Inflation Fears Rise

The Dow Jones Industrial Average (DJIA) extended losses throughout Friday's session after a weaker-than-expected consumer sentiment reading. The preliminary September Index of Consumer Sentiment dropped to 54.2 from August's 58.2, well below the 80 threshold indicating Optimism and missing consensus estimates. "Consumers see growing risks across business conditions, labor markets, and inflation," said Surveys of Consumers Director Joanne Hsu.

Inflation expectations remain elevated, with year-ahead projections holding at 4.8%—significantly above August's CPI and Core CPI readings of 2.9% and 3.1%. Long-term inflation expectations climbed to 3.9%, marking a second consecutive monthly increase. The data underscores persistent macroeconomic headwinds as U.S.-China trade representatives prepare for September 14-17 talks in Madrid.