FiscalFusion

Stocks wavered to a mixed finish on Wall Street Friday and logged their first weekly loss in four. Major indexes fluctuated throughout the week before pulling back from record highs set the previous week, with technology stocks once again steering the broader market’s direction. The S&P 500 spent most of the day in negative territory, falling as much as 1.3%, but ended with a slight gain of 8.48 points, or 0.1%, to 6,728.80. The Dow Jones Industrial Average made a similar turnaround, rising 74.80 points, or 0.2%, to 46,987.10. The tech-heavy Nasdaq fell as much as 2.1% during trading but recovered most of those losses, finishing 49.46 points lower, or 0.2%, at 23,004.54. Technology stocks weighed heavily on the market, particularly high-valuation giants like Alphabet, which fell 2.1%, and Broadcom, which slipped 1.7%.

Wall Street remained focused on corporate earnings and forecasts. Block sank 7.7% after disappointing results, while Peloton jumped 14.2% on stronger-than-expected numbers. Expedia Group surged 17.5% after topping analysts’ earnings estimates. With more than 90% of S&P 500 companies having reported, most have beaten expectations, with tech showing the strongest growth, according to FactSet. Investors are watching profits closely as they try to determine whether the market’s high valuations are justified, especially as key government economic reports remain unavailable due to the prolonged government shutdown — now the longest in U.S. history.

Missing data includes the October jobs report and previously delayed September employment numbers, a concerning gap as the labor market was already weakening. Private data sources partly fill the void, including the University of Michigan’s consumer sentiment survey released Friday, which showed a sharp drop to a three-year low despite economists expecting an increase. “Consumers are starting to get concerned about the potential effects of the government’s shutdown on economic activity,” wrote Eugenio Aleman of Raymond James. The survey also reported slightly higher inflation expectations, but official inflation data is also missing due to the shutdown. Persistent inflation remains a top concern, particularly amid a volatile U.S. trade war that could worsen price pressures.

The lack of employment and inflation data complicates the Federal Reserve’s stance on future interest rate cuts. The Fed has already cut rates twice this year to counter a softening job market, though further cuts risk stoking inflation above its 2% target. Still, Wall Street is largely betting on another cut in December, with CME FedWatch showing a 67% probability. Treasury yields held steady, with the 10-year at 4.09% and the two-year at 3.56%. Overseas, markets in Europe and Asia fell. China reported a 1.1% drop in October exports, including a steep 25% decline in shipments to the U.S., though economists expect improvement after President Donald Trump and President Xi Jinping agreed last week to de-escalate trade tensions..