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Nonfarm payrolls increase by 143,000 in January

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Expedia ( EXPE ) jumps after Q4 results beat

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Indexes down: Dow 0.45%, S&P 500 0.53%, Nasdaq 0.93%

(Updates with afternoon trading prices)

By Shashwat Chauhan and Sukriti Gupta

Feb 7 (Reuters) -

U.S. stocks fell on Friday after weak jobs data and the

expectations of higher inflation raised the chances of a more

cautious Federal Reserve, while a report stating that President

Donald Trump might impose reciprocal tariffs added to worries.

A survey showed U.S. consumer sentiment dropped unexpectedly

in February to a seven-month low and inflation expectations

rocketed, with households seeing inflation over the next year

surging to 4.3% - the highest since November 2023.

"Today's surge in year-ahead inflation expectations

comes along with other price signals this week that are not

favorable for the Federal Reserve to deliver on expected rate

cuts," Wells Fargo economists said.

Earlier in the day, U.S. job growth slowed more than

expected in January after robust gains in the prior two months,

but a 4% unemployment rate probably will give the Fed cover to

hold off cutting interest rates at least until June.

The final employment report under former President Joe

Biden's administration showed 598,000 fewer jobs were created in

the 12 months through last March than previously estimated.

The final payrolls benchmark revision, however, was less

than the reduction of 818,000 jobs estimated back in August.

Traders of short-term interest-rate futures now expect

the Fed to cut interest rates just

on

ce this year, backing away from earlier bets on two rate

cuts starting in June.

Two sources familiar with the plans told Reuters that

Trump told Republican lawmakers that he planned to

announce reciprocal tariffs

as early as Friday.

"Welcome to Trump 2.0, same as Trump 1.0. Every day you

get a new headline and every day you get market volatility,"

said Thomas Hayes, chairman at Great Hill Capital LLC.

At 11:23 a.m. ET, the Dow Jones Industrial Average

fell 203.26 points, or 0.45%, to 44,545.15, the S&P 500

lost 32.16 points, or 0.53%, to 6,051.41 and the Nasdaq

Composite lost 183.29 points, or 0.93%, to 19,608.70.

Nine of the 11 S&P 500 sectors traded lower, with consumer

discretionary leading losses with a 1.7% fall.

Amazon.com ( AMZN ) dipped 3.7% due to weakness in the

retailer's cloud computing unit, Amazon Web Services, and

lower-than-expected forecasts for first-quarter revenue and

profit.

Markets had a dismal start to the week when Trump announced

sweeping trade tariffs over the weekend, but suspended the

levies on goods from Mexico and Canada on Monday for a month.

Since then, a host of strong earnings and optimism about a

potential China-U.S. trade deal despite Beijing's tit-for-tat

tariffs have the S&P 500 and the Dow on track for weekly gains,

with the blue-chip index on pace for its fourth straight

weekly rise.

Among other movers, Expedia ( EXPE ) added 18.2% after the

online travel platform posted better-than-expected

fourth-quarter results.

Elf Beauty ( ELF ) tumbled 19.3% after the cosmetics company

cut its annual net sales and profit forecasts,

Declining issues outnumbered advancers by a 2.05-to-1 ratio

on the NYSE and by a 2.19-to-1 ratio on the Nasdaq.

The S&P 500 posted 33 new 52-week highs and 16 new lows

while the Nasdaq Composite recorded 77 new highs and 104 new

lows.

(Reporting by Shashwat Chauhan and Sukriti Gupta in Bengaluru;

Editing by Pooja Desai and Anil D'Silva)