Amazon Stock Drops Amid Earnings Report, Monolithic Power Surges

The S&P 500 dropped 1.6% on Friday, August 1, 2025, after the July jobs report revealed unanticipated pressure on the US labor market. Amazon's stock fell 8.3% despite topping revenue and net income estimates. Eastman Chemical's shares plummeted 19% after reporting year-over-year sales and profit declines. Monolithic Power Systems' shares soared over 10% after releasing strong quarterly results with growth across numerous end markets.

The S&P 500 experienced a significant decline of 1.6% on Friday, August 1, 2025, following the release of the July jobs report, which revealed unanticipated pressure on the U.S. labor market. The report showed an unemployment rate rise to 4.2%, up from 4.1% in June, and a weaker-than-expected job growth of 73,000, well below the estimated 105,000 new jobs [1].

Amazon's stock, despite topping revenue and net income estimates, fell by 8.3%, reflecting investor concerns about the broader economic outlook and potential impacts of tariffs on consumer spending [1]. Eastman Chemical's shares plummeted by 19% after reporting year-over-year sales and profit declines, further highlighting the sector's vulnerability to economic uncertainty [1].

Meanwhile, Monolithic Power Systems' shares soared over 10% after releasing strong quarterly results, demonstrating growth across numerous end markets. The company's resilience suggests that certain sectors may be better positioned to weather the economic challenges posed by tariffs and trade uncertainty [1].

The new tariff rates, which will go into effect in seven days, were announced by President Donald Trump before an Aug. 1 deadline he gave to about 180 countries to either reach trade deals or face higher import duties. Economists attribute the weak jobs report, in part, to tariffs, which have led businesses to hold off on major investments and hiring [1].

Investors reacted negatively to the tariff announcement and the disappointing jobs report, with U.S. stocks remaining negative throughout the day. The blue-chip Dow fell 0.99%, the S&P 500 slipped 1.16%, and the tech-heavy Nasdaq declined 1.58% [1]. The benchmark 10-year Treasury yield also fell to 4.237%, indicating a flight to safety [1].

The Federal Reserve is expected to consider a rate cut in September, with the CME FedWatch tool showing an 83% chance of a rate cut due to the weaker-than-expected jobs report [1]. The move is seen as a response to the economic uncertainty and potential impact of tariffs on the labor market.

The Swiss watch industry, facing a 39% tariff on luxury watches and chocolate, has expressed concern about the potential negative impact on sales [1]. The Swiss government has called for a negotiated solution, but the tariffs may exacerbate the industry's current struggles with weak global demand.

Canada may walk away from trade talks with the United States due to a 35% tariff on certain goods, an advisor to Prime Minister Mark Carney said. The decision to impose the tariffs was cited as a response to Canada's failure to address U.S. concerns about trade barriers and fentanyl smuggling [1].

The Brazilian coffee industry is expected to be significantly impacted by a 50% tariff on Brazilian products, including coffee, which will begin on August 6. This tariff is likely to reshape trade routes, with traders looking for indirect routes into the U.S. to avoid the levies [1].

In summary, the S&P 500's decline reflects investor concerns about the U.S. labor market and the broader economic implications of tariffs and trade uncertainty. The Federal Reserve's potential rate cut and the ongoing trade negotiations will be key factors to watch in the coming weeks.

References:
[1] https://www.oklahoman.com/story/news/politics/2025/08/01/trump-tariffs-trade-talks-stock-market-updates/85471521007/