Stocks notch weekly gains as Fed meeting looms

10 個月前

STORY: U.S. stocks ended higher on Friday after a choppy session and a rocky week, as economic data and corporate earnings guidance both hinted at softening demand but also a resilient economy.

The Dow closed up but essentially unchanged. The S&P 500 gained a quarter of a percent, while the Nasdaq added nearly a full percent, as the tech-heavy index notched its fourth straight weekly advance.

The Commerce Department's hotly anticipated personal consumption expenditures report or PCE, the Federal Reserve's preferred inflation gauge, indicated cooling inflation - exactly what the central bank's interest rate hikes are intended to accomplish.

Ken Moraif, founder and CEO of Retirement Planners of America, called it another good sign ahead of next week's Fed policy meeting.

"I think that the economy is showing resilience. Inflation is probably going to start coming down here for the next few months. And so the combination of that is alleviating the fears that people have that the Fed is going to have to raise interest rates so high that they cause a bad recession. So it's starting to look more and more like maybe that soft landing could happen after all. You also have Europe where the winter that everybody thought was going to come, turns out was a lot warmer. They're our biggest trading partner, profits come from that. And if they don't have a massive recession, our companies should do better. So the picture is starting to look a lot better than all the doom and gloom that we were thinking a few months ago."

On the earnings front, credit card giant American Express jumped 10.5% on consensus-beating results and an upbeat forecast.

Rival Visa also reported better-than-expected quarterly results, easing worries of waning consumer demand, sending its shares up 3%.

Shares of Intel fell more than 6% after the chipmaker provided dismal earnings projections that were short of Wall Street estimates by about $3 billion.

Shares of Chevron fell more than 4% after the oil giant posted record 2022 profit, but its fourth quarter earnings fell short of expectations.

Next week, a raft of high profile earnings reports are expected, notably from Apple, Amazon, Alphabet and Meta Platforms, which will test a recent bounce for tech and mega-cap stocks.