Stocks slide as investors digest hiring slowdown and new U.S. tariffs

Stocks slid in early trade Friday amid signs that hiring around the U.S. is hitting a wall and as investors assess the potential impact of the Trump administration's new tariffs on dozens of countries.

The Dow Jones Industrial Average fell 772 points, or 1.4%, shortly after the opening bell, while the S&P sank 102 points, or 1.6%. The tech-heavy Nasdaq Composite shed 439 points, or 2.1%. Stocks in Europe and Asia also dropped.

Markets are reacting to a weaker-than-expected jobs report, which showed that employers added only 73,000 jobs in July, falling short of economic forecasts. The Labor Department also revised payroll gains down for May and June by a combined 258,000, a sign that hiring earlier this year was weaker than previously estimated.

Market sentiment is also being tested by the White House late Thursday unveiling new tariff rates on over 60 countries. The new policies hike rates to their highest level in decades, including for key economic partners. Imports from Canada, the U.S. largest trading partner, will face a 35% tariff, while levies will top 40% for countries such as Laos, Myanmar and Syria.

Imports from other countries not targeted with higher "reciprocal" U.S. tariffs will face a 10% tariff, the same baseline that President Trump announced in April before pausing the new rates to allow for trade talks.

"Stocks are not reacting well to the information we've received over the past two days and it's no surprise as to why," Bret Kenwell, an investment analyst at eToro, said in an email to CBS MoneyWatch. "Inflation is ticking higher, jobs growth is stagnating, and while the tariff situation has improved from a few months ago, August 1st serves as a reminder that it's not fully resolved."

In light of the employment data, investors have now stepped up their expectations for the Federal Reserve to lower interest rates in September. The Fed announced earlier this week that it would hold interest rates steady at its current range of 4.25% to 4.5%, signaling a continuing of their wait-and-see approach.

The CME FedWatch tool puts the likelihood of a September rate cut at around 80%.

The Associated Press contributed to this report.