U.S. stock indexes ended the week on a mixed note, with the S&P 500 closing little changed after a 6-week winning streak. The Dow Jones Industrial Average fell 0.6%, marking its first weekly loss in 6 weeks, while the Nasdaq composite eked out a 0.6% gain, extending its winning streak to 7 weeks.
Investors have been cautious as stocks have pulled back from record highs, with concerns rising about valuations being too high. Higher Treasury yields have also made stocks less attractive to investors.
Earnings reports from companies have been a focus for investors, with Capital One Financial rising 5.2% after beating financial forecasts and Deckers Outdoor climbing 10.6% after raising its financial forecast for the year. Other companies like L3Harris Technologies and Western Digital also saw gains driven by strong earnings.
However, not all companies fared well. Capri Holdings, owner of luxury brands like Versace and Michael Kors, lost nearly half its value after a judge halted its purchase by Tapestry. Tapestry, on the other hand, rose 13.5%. McDonald’s also saw a decline of 3% due to an E. coli outbreak linked to its Quarter Pounders.
Treasury yields have been on the rise, with the 10-year Treasury yield reaching 4.24%, up from 4.21% the previous day. This increase is a result of reports showing a stronger-than-expected U.S. economy.
Looking ahead, Wall Street will be closely watching updates on consumer confidence, jobs, and inflation next week. Economists expect a key report on consumer spending to show a decrease in the rate of inflation to 2%. The Federal Reserve has already raised its benchmark interest rate to combat inflation, and more rate hikes are expected in the coming months.
In global markets, Russia’s central bank raised its key interest rate to a record-high 21% to combat inflation caused by military spending. In Europe, stock markets were mixed, with Germany’s DAX rising, France’s CAC 40 falling, and Britain’s FTSE 100 edging lower. Asian markets also saw mixed results.
Overall, the market remains cautious as investors navigate through earnings season and monitor economic indicators for signs of inflation and interest rate changes.