McDonald's (MCD) shares plummeted 5.03% during intraday trading on Friday, as investors reacted to concerns about the impact of newly announced tariffs on the restaurant industry. The fast-food giant's stock decline comes amid a broader selloff in restaurant stocks, with competitors like Starbucks, Yum Brands, and Domino's Pizza also experiencing significant drops.

The sharp decline in McDonald's stock price can be attributed to several factors stemming from the recent tariff announcements. Analysts at Stifel warn that the restaurant industry faces considerable risks due to potential changes in consumer behavior. "The announced tariffs pose the greatest risk to the restaurant industry through potential impacts on consumer demand," stated Stifel analyst Chris O'Cull. Higher costs for U.S. companies reliant on imports may lead to price increases or layoffs, affecting consumer spending and reducing disposable income for dining out.

McDonald's, with its significant international presence, is particularly vulnerable to these economic headwinds. The company faces a dual threat of reduced domestic consumer spending and potential negative sentiment in overseas markets. "We believe sales will likely soften due to anti-American sentiment, which could impact the recent improvement in international trends that some of these companies have experienced," O'Cull added. While the direct impact of tariffs on food costs may be limited for most restaurants, the indirect effects on consumer behavior and global operations pose substantial challenges for McDonald's and its peers in the coming months.