Investing.com– U.S. stocks fell Friday, handing back some of the week’s gains as investors digested a hawkish Federal Reserve, a cooling in inflation as well as strength in the technology sector.
At 09:35 ET (13:35 GMT), fell 175 points, or 0.5%, dropped 17 points, or 0.3%, and slipped 50 points, or 0.3%.
Weekly gains likely
Despite Friday’s losses, the S&P 500 is still on course to gain 1.2% this week and the Nasdaq 2.7%, with the 30-stock DJIA the laggard with a 0.9% decline.
Data earlier in the week showed that unexpectedly fell in May, a day after mildly softer , adding to optimism that a disinflationary trend was in play, likely leading to lower interest rates by the end of the year.
This helped soothe some market jitters around the Fed’s updated policy projections earlier in the week, which signaled that the central bank now expects to reduce rates just once in 2024.
Cleveland Federal President was reported earlier Friday saying that it is important not to wait too long to cut interest rates, as it is clear than monetary policy was affecting the economy.
That said, she also noted that the policymakers needed to see inflation fall more from current levels, believing that the central bank was in a goof position with monetary policy.
Adobe soars after strong earnings
The tech sector has dominated activity this week, extending a rally seen earlier this week that was largely triggered by market major Apple (NASDAQ:) announcing a major foray into AI. Apple’s announcement lent more fuel to the AI rally, and also saw the stock briefly become the most valuable company on Wall Street.
This continued Friday, with Adobe Systems (NASDAQ:) stock soared 15% after the software giant logged strong earnings and hiked its 2024 guidance on higher demand for its AI-powered editing tools.
Electric vehicle maker Tesla (NASDAQ:) gained over 1% after shareholders voted in favor of a controversial $56 billion pay package for CEO Elon Musk, as well as the company’s reincorporation in Texas.
Crude set for strong weekly gains
Crude prices gained Friday, on course for their best week in more than two months on increased hopes for demand growth this year.
By 09:35 ET, the U.S. crude futures (WTI) traded 0.3% higher at $78.89 per barrel, while the Brent contract dropped 0.5% to $83.19 a barrel.
Both benchmarks were up over 4% this week — the best week since April 5.
The Organization of the Petroleum Exporting Countries stuck to a forecast for relatively strong growth in global oil demand for 2024, overshadowing a more bearish report by the International Energy Agency. Additionally, influential investment bank Goldman Sachs forecast solid U.S. fuel demand this summer.
(Ambar Warrick contributed to this article.)