Despite reaching new highs earlier in the week, Wall Street closed the week on a lower note, with the Dow Jones Industrial Average experiencing its worst week since October. The S&P 500 and Nasdaq Composite also ended in the red, with losses of 0.26% and 1.17%, respectively.
Earnings season continued to wind down with mostly positive results, as 73% of S&P 500 companies reported an upside earnings surprise and 64% reported better-than-expected revenue results. However, there were some disappointments, such as Foot Locker, which saw a sell-off in response to its report.
The big economic data drop of the week came with February’s nonfarm payrolls report, which supported the “soft landing” thesis. While job additions were more than expected, there was a higher-than-anticipated unemployment rate and softer annual wage inflation.
Looking ahead, key macroeconomic updates will command the stage in the coming week, with the focus on the February consumer price index report. Economists are looking for a 3.1% annual increase at the headline level and a 3.7% annual increase at the core level. This data will factor into Wall Street’s thinking about the Fed’s next move on interest rates.
Overall, the week ended on a cautious note as investors navigate through economic data and earnings reports to gauge the future direction of the market. The coming week will bring more insights into inflation and consumer spending, providing further clarity on the state of the economy.
