Stocks in the US closed mixed on Friday, as investors weighed the latest corporate results and economic data. The S&P 500 edged lower, snapping 6-day winning streak and the Nasdaq 100 lost 0.5%, while Dow Jones finished higher by 60 points. Annual core PCE inflation slowed more than expected last month to below 3% while the PCE rate and monthly measures came in line with forecasts. On the corporate front, American Express soared 7.1% after the company said it expects revenue in 2024 to increase 9% to 11%. Capital One Financial rose 4.6% following its upbeat fourth quarter revenue. Conversely, Intel sank 11.9% after issuing a disappointing guidance although earnings and revenue topped estimates. Visa lost 1.7% after providing a tepid outlook. Spirit Airlines tumbled 13.3% after JetBlue warned it may have to terminate its merger with the budget carrier. On the week, the S&P 500 added 0.5%, the Dow rose 0.1% and Nasdaq 100 ended slightly higher.
Frankfurt’s DAX index closed 0.4% higher at a record high of 16,961 on Friday, driven by strong gains from Sartorius (9.9%) and Merck (6%). Investors continued to assess prospects for ECB interest rate cuts, a day after the bloc's central bank left rates unchanged. Additionally, President Lagarde indicated that it was too early to talk about rate cuts, but risks to economic growth are "tilted to the downside." Meanwhile, economic data showed a sharp deterioration in German consumer morale heading into February, with the index falling to its lowest level since March 2023, amid concerns over geopolitical tensions and persistently high inflation. In the US, PCE price inflation held steady at 2.6% in December as expected, while the core rate eased to 2.9% from 3.2%, slightly below the market consensus of 3%.
The S&P/ASX 200 Index gained 0.48% to close at 7,555 on Thursday, rising for the fifth straight session, with mining stocks leading the advance as fresh stimulus in China bolstered the demand outlook. China pledged to reduce banks’ reserve requirement ratio by 50 basis points next month in a bid to boost the economy, freeing up about 1 trillion yuan in long-term funding to the markets. Australian shares also tracked gains on Wall Street overnight after Netflix posted strong quarterly revenue and subscription growths, although a sharp decline in Tesla shares after-hours weighed on sentiment. Heavyweight iron ore miners led the advance, with gains from BHP Group (1.5%), Fortescue Metals (2%) and Rio Tinto (2.8%). In corporate news, Domino’s Pizza plunged 31.1% following the release of a disappointing quarterly report. Australian markets will be closed on Friday for a national holiday.
The Shanghai Composite rose 0.14% to close at 2,910 while the Shenzhen Component fell 1.06% to 8,762 in mixed trade on Friday, with mainland stocks struggling for clear direction amid a lack of market-moving cues. Still, Chinese stocks finished the week higher as fresh policy support from Beijing boosted market sentiment. The People’s Bank of China unexpectedly announced late on Wednesday that it will reduce banks’ reserve ratio by 50 basis points next month in a bid to boost the country’s struggling economy. The move would free up around 1 trillion yuan in long-term capital to the economy. Earlier this week, China’s cabinet also pledged to stabilize capital markets, reportedly seeking to deploy about 2 trillion yuan as part of a fund to buy mainland shares. Growth-oriented technology, new energy and consumer-related stocks, as well as financial firms were among the best performers this week.
The Ibovespa advanced by 0.6% to finish around the 129,009 level on Friday, building on previous session gains, supported by the mining giant, Vale. Recent inflation data further supported the Brazilian central bank’s indicated trajectory of ongoing Selic rate cuts. January’s mid-month IPCA-15, considered a preview for inflation, increased less than expected, slowing from the previous month's 0.31% month-on-month and 4.47% year-on-year gauge. On the corporate front, the index heavyweights Vale and Petrobras advanced by 1.7% each. Usiminas stood out among top performers, rising 5.4% after JP Morgan upgraded their recommendation to a purchase. Conversely, Gol shares exerted significant downward pressure on the index, falling 7.7% after the company filed for judicial recovery in the US. On the week, the Ibovespa advanced nearly 0.9%.
