Stocks fell on Wall Street Friday and are on track for a mixed finish in a week that was heavy with reports showing that inflation, though broadly cooling, remains stubborn. The S&P 500 fell 0.4% and is on track for a slight gain this week. The index set a record high on Tuesday, but has been mostly wavering since.
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- Stocks on Wall Street experienced a decline, with the S&P 500 dropping by 0.4%, despite setting a record high earlier in the week. The market’s movement this week is expected to result in a mixed finish.
- The Dow Jones Industrial Average slightly fell by 0.1%, while the Nasdaq composite saw a more significant decrease of 0.6%.
- A notable drop in the market was observed in technology stocks, particularly Adobe, which plummeted by 13.9% following a disappointing revenue forecast.
- The University of Michigan reported an unexpected dip in consumer sentiment for March, indicating a decrease in economic optimism among consumers. However, there is still an expectation for further reduction in inflation rates.
- Wall Street remains focused on inflation concerns, hoping for the Federal Reserve to initiate interest rate cuts. The Fed’s aggressive interest rate hikes since 2022 aimed at controlling inflation have been a central issue.
- Recent reports on consumer and wholesale prices suggest that inflation continues to persist at higher levels than anticipated, with consumer inflation registering at 3.2% in February.
- The economy showed some signs of weakening in other reports this week, fueling speculation about the potential for long-term inflation moderation.
- The Federal Reserve is expected to update its interest rate forecasts after its policy meeting on Wednesday, with market traders anticipating a possible rate cut in June.
- Bond yields experienced a slight increase, with the yield on the 10-year Treasury rising to 4.31% and the 2-year Treasury yield going up to 4.72%.
- European markets mostly saw gains, whereas Asian markets faced declines.
The Associated Press has the story:
Wall Street slips further away from records amid inflation worries
Newslooks- (AP)
Stocks fell on Wall Street Friday and are on track for a mixed finish in a week that was heavy with reports showing that inflation, though broadly cooling, remains stubborn.
The S&P 500 fell 0.4% and is on track for a slight gain this week. The index set a record high on Tuesday, but has been mostly wavering since.
The Dow Jones Industrial Average fell 55 points, or 0.1%, and the Nasdaq composite fell 0.6%.
Technology stocks were the biggest weights sinking the market. Software maker Adobe slumped 13.9% after giving investors a weak revenue forecast.
A closely-watched report from the University of Michigan showed that consumer sentiment unexpectedly fell in March. Consumers became slightly less optimistic about the economy, but continue to expect inflation to come down further, a potential sign that consumer prices will come under control.
Inflation remains the big concern for Wall Street amid hopes for the Federal Reserve to start cutting interest rates. The Fed sharply raised interest rates starting in 2022 in an effort to tame inflation back to its 2% target. Inflation at the consumer level was as high as 9.1% in 2022.
A report on consumer prices this week showed inflation remains stubborn, ticking up to 3.2% in February from 3.1% in January. Another report on prices at the wholesale level also showed inflation remains hotter than Wall Street expected.
Other reports this week showed some softening in the economy, which bolstered hopes for a continued long-term easing of inflation.
Fed officials will give their latest forecasts for where they see interest rates heading this year on Wednesday, following their latest policy meeting. Traders are still leaning toward a rate cut in June, according to data from CME Group. The central bank has previously signaled that it expects three rate cuts in 2024. Lower rates would relieve pressure on the economy and financial system.
Bond yields edged higher. The yield on the 10-year Treasury rose to 4.31% from 4.29% late Thursday. The yield on the 2-year Treasury, rose 4.72% from 4.69%.
Markets in Europe mostly gained ground, while markets in Asia slipped.
