In a mixed morning session on Friday, stocks showed resilience, largely building on the solid gains witnessed throughout the week. Wall Street’s attention was divided between retail updates and the impact of falling oil prices, with investors scrutinizing these signals for insights into the trajectory of the economy.
The S&P 500 (^GSPC) experienced a marginal uptick of approximately 0.1%, while the Dow Jones Industrial Average (^DJI) posted a gain of nearly 0.2%, equivalent to roughly 690 points. In contrast, the Nasdaq Composite (^IXIC), dominated by tech-heavy stocks, dipped by 0.1%.
The positive momentum observed across all three major U.S. indexes during the week can be attributed to a robust midweek rally. Market sentiment pivoted as confidence grew in the possibility of the Federal Reserve easing back on interest-rate hikes. Favorable indicators, such as cooler inflation and softer jobs data, were interpreted as signs that the central bank’s tightening measures are beginning to impact the U.S. economy.
Retail updates further fueled concerns about a potential economic slowdown. Gap (GPS) delivered a pessimistic forecast for holiday sales in its earnings report late Thursday, aligning with similar warnings from retail giants Walmart and Target. These cautionary tales suggest a looming downturn in consumer spending that could significantly impact the crucial holiday shopping season.
Simultaneously, oil prices hinted at economic deceleration, sliding into bear market territory ahead of the upcoming OPEC+ meeting scheduled later in November. West Texas Intermediate crude (CL=F) and Brent crude futures (BZ=F) both saw a modest uptick of around 1%, but were still on track for a weekly loss after reaching their lowest levels in nearly four months.
In the tech sector, Alibaba’s (BABA) decision to abandon the spin-off of its cloud unit drew attention to challenges faced by the Chinese e-commerce giant. The company’s shares experienced a significant decline in New York, wiping out more than $20 billion in market value. Alibaba attributed the decision to Washington’s chip curbs, underscoring the ongoing tensions in U.S.-China relations. This development comes on the heels of a meeting between the two countries’ presidents that failed to yield substantial progress, highlighting the persisting strains between the economic powerhouses.
As Wall Street wraps up the week with mixed gains, investors remain vigilant for further economic signals, closely monitoring updates in the retail sector, oil prices, and the evolving dynamics of international trade relations.
Source: Yahoo Finance
