US Stock Market Ends Flat as Mixed Bank Earnings Offset Inflation News/AFP
US Stock Market Ends Flat as Mixed Bank Earnings Offset Inflation News
The US stock market concluded a range-bound Friday session with mixed results, driven by bank earnings and inflation data. The Dow Jones index finished 0.31% lower, the Nasdaq ended 0.02% higher, and the S&P 500 added 0.08%. Advancing issues surpassed decliners on the NYSE, while decliners outpaced advancers on Nasdaq.
Despite cooler-than-expected inflation data, the Dow gained 0.34% for the week, the S&P 500 rose 1.84%, and the Nasdaq climbed 3.09%. These gains marked the most significant weekly percentage rise for the S&P since mid-December and for the Nasdaq since early November.
US Producer Prices Index (PPI) data for December unexpectedly fell, influenced by lower costs for goods like food and diesel fuel, along with unchanged prices for services. This contrasts with Thursday’s hotter-than-expected consumer inflation reading.
Michael Green, chief strategist at Simplify Asset Management in New York, highlighted that the PPI data indicates the Federal Reserve may have room to cut interest rates. He mentioned, “It raises the probability that the Fed has the free and clear to decide to cut interest rates, and the equity market doesn’t care all that much as long as rates are not pushing significantly higher.”
Bank of America’s fourth-quarter profit decline led to a 1.06% drop in its shares, while Wells Fargo’s warning of a 7-9% decrease in net interest income in 2024 resulted in a 3.34% decline in its shares. However, Citigroup rose 1.04% despite reporting a $1.8 billion fourth-quarter loss.
JPMorgan Chase, after reporting its best-ever annual profit and forecasting higher-than-expected interest income for 2024, edged 0.73% lower.
The Dow faced downward pressure primarily due to a 3.37% decline in UnitedHealth, reporting higher-than-expected medical costs. Delta Air Lines fell 8.97% after revising its annual profit outlook.
Tesla’s shares dropped 3.67% following the company’s decision to trim prices for some new China models and suspend most car production at its factory near Berlin.