Wall Street’s main indexes closed lower on Friday as investors stepped back while they digested a mixed bag of economic data and earnings reports and prepared for a week filled with economic releases and a Federal Reserve meeting.
The Dow Jones Industrial Average fell 140.82 points, or 0.3%, to 44,424.25. The blue-chip index still finished up more than 2% for the week.
The S&P 500 and Nasdaq declined 0.3% and 0.5%, respectively. All three indexes posted their second straight week of advances.
The technology sector was the biggest drag on the market as megacap stocks including Nvidia reversed after rallying sharply earlier in the week.
The housing market data was hotter than expected, while an S&P Global survey showed business activity slowing to a ninth-month low in January as prices rose. However, firms reported increased hiring, supporting the Federal Reserve’s cautious approach to monetary policy this year.
The University of Michigan’s final estimate on consumer sentiment dropped to 71.1 from a previous estimate of 73.2.
At the end of a relatively light week for data, traders were betting the Fed would keep borrowing costs unchanged at its Jan. 28-29 meeting and expect its first rate cut in June, the latest data from CME Group’s FedWatch tool showed.
“It really boils down to some mixed economics and earnings news,” said Scott Helfstein, head of investment strategy at ETF company Global X.
Investors are bracing for next week’s slew of key inflation and economic growth data as well as the Fed meeting, while waiting for policy updates from the Trump administration.
“There is anticipation of a really big news week ahead. And there is lingering policy uncertainty with the new administration’s first week on the job, which is likely to persist for the next few weeks,” he said.
Investors worry that President Trump’s proposed tariffs could exacerbate inflationary pressures and slow Fed rate cuts, after he referred to trade policy multiple times this week without providing concrete details of his plans.
Trump has said tariffs on Mexico, Canada, China and the European Union could be announced on Feb. 1, but analysts say major plans could be announced on April 1.
The benchmark S&P 500 ended Thursday at a record high for the first time since early December after Trump called for taxes, oil prices and interest rates to be lowered during his first international appearance this term at the World Economic Forum in Davos, Switzerland.
On the earnings front, American Express reported a 12% jump in fourth-quarter profit. Its shares, however, fell 1.4% and weighed on the blue-chip Dow.
Also dragging on the Dow was Boeing, which also fell 1.4% after the planemaker warned of a fourth-quarter loss of about $4 billion. Boeing, whose shares in 2024 logged their steepest annual drop since the pandemic, is scheduled to report results on Tuesday.
Verizon rose 1% after the cellphone service provider reported higher-than-expected quarterly subscriber additions.
