US blue chip stocks closed lower after investors assessed mixed economic data, the central bank reiterated its commitment to fighting inflation and investors’ appetite for risk cooled.
Wall Street’s S&P 500 index rose 1.9% on Friday but fell 0.7% in a week of four trading sessions due to Monday’s holiday. The tech-rich Nasdaq Composite rose 2.7% on Friday and 0.6% for the week.
Economic data released this week showed retail sales and wholesale prices fell more than expected in December, with the former fueling health concerns among American consumers, while the latter helped boost price growth. shows a slowdown in
Meanwhile, weekly unemployment claims fell to a four-month low, suggesting the U.S. labor market remains strong despite efforts by the Federal Reserve to raise borrowing costs. . But several big names, including Microsoft and Google’s parent company Alphabet, announced this week that they were laying off tens of thousands of employees.
Alphabet shares rose 5.3% on Friday after it announced it would lay off 12,000 employees, or about 6% of its workforce. Despite co-founder Reed Hastings announcing his resignation as chief executive, Netflix stock surged 8.5% as subscriber numbers beat expectations.
Wall Street stocks rose mid-session on the backing of Fed President Christopher Waller. rate hike by a quarter A slowdown from recent pace by the US Central Bank at its next policy meeting in February.
This comes as European Central Bank President Christine Lagarde and Federal Reserve Vice-Chairman Rael Brainard pledged on Thursday to ‘maintain their course’ on rising interest rates, and borrowing costs could soon fall. It happened after showing the market that . Signs of slowing US economic growth further eroded investor confidence, dragging down the stock market after a relatively strong start to the year.
“Over the past two months or so, both equities and bonds have welcomed early signs of disinflation and slowing growth, reinforcing the peak rate narrative,” Barclays analysts said. “But the mantra of ‘bad data is good news for stocks’ now seems to be over in the US.”
“Europe, by contrast, seems to be in a prime position right now,” the bank added. “Despite the ECB’s hawkishness, hopes of disinflation pushed yields lower, while lower energy prices and improved economic sentiment from China’s reopening boosted stocks.”
Wall Street stocks have fallen out of favor with many big investors. Global fund managers have cut their allocations to the U.S. stock market to their lowest levels in 17 years, according to a Bank of America study released this week. Emerging market stocks are trending again.
Hong Kong’s Hang Seng Index and China’s CSI 300 have risen 50% and 20% respectively since the beginning of November as Beijing reversed a strict zero-Covid policy that has been in place since early 2020. The index rose 1.8% and 0.6% cents on Friday.
In Europe, the regional Stox 600 was up 0.4%, the German Dax was up 0.8% and the London FTSE 100 was up 0.3%.
Elsewhere, the price of Brent crude, an international oil benchmark, rose 1.7% to $87.63 a barrel for a second consecutive week as traders expressed optimism that China’s reopening would boost fuel demand. rose in
A measure of dollar strength against a basket of six peers fell 0.1%. The currency has depreciated more than 8% over the past three months.
