The Nasdaq slumped 249.61 points (1.2%) to 21,455.55, the S&P 500 slid 41.60 points (0.6%) to 6,460.26 and the Dow dipped 92.02 points (0.2%) to 45,544.88. The major U.S. averages ended slightly lower for the week, with the S&P 500 dipping 0.1% and both the Dow and Nasdaq slipping 0.2%. The pullback reflected profit-taking after recent gains, though the S&P 500 still managed to notch a record closing high on Thursday. Market activity remained choppy as traders balanced optimism with caution.
Economic data showed consumer prices moved in line with expectations for July, keeping inflation trends steady. The PCE price index rose 0.2% for the month and held at 2.6% annually, while core PCE advanced 0.3%, pushing the yearly rate to 2.9%. These figures reinforced expectations of a Federal Reserve rate cut next month.
CME Group's FedWatch tool indicated an 87.1% chance of a quarter-point cut at the September meeting. Meanwhile, political attention turned to Washington, where Fed Governor Lisa Cook sought to block her removal by President Trump. The hearing ended without District Judge Jia M. Cobb issuing a ruling, leaving Cook's fate up in the air going into the long week.
Semiconductor stocks turned in some of the market's worst performances on the day, dragging the Philadelphia Semiconductor Index down by 3.2%. Computer hardware stocks was considerably weak, with the NYSE Arca Computer Hardware Index tumbling by 2.0% after ending the previous session at a record closing high. Dell Technologies (DELL) helped lead the sector lower, plunging by 8.9% after reporting better than expected second quarter results but providing disappointing guidance. Gold stocks strongly moved to the upside along with the price of the precious metal, driving the NYSE Arca Gold Bugs Index up by 3.3%.
Asia-Pacific stocks turned in a mixed performance. Japan's Nikkei 225 Index dipped by 0.3% while China's Shanghai Composite Index rose by 0.4%. Meanwhile, the major European markets all moved to the downside on the day while the French CAC 40 Index slid by 0.8%, the German DAX Index declined by 0.6% and the U.K.'s FTSE 100 Index fell by 0.3%.
In the bond market, treasuries gave back ground after trending higher over the past few sessions. As a result, the yield on the benchmark ten-year note which moves opposite of its price, rose by 2 bps to 4.22%.
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