The $SPX500 ended the week with a 0.51% decline, closing at 5,277.51 points after posting losses in two out of four sessions due to the Memorial Day holiday. The $SPY also shed 0.39% during the week.
This marked the benchmark index's first weekly decline following a five-week winning streak. The $SPX500 has retreated from its record closing high of 5,321.49 reached the previous week. Investors have been evaluating the diminishing likelihood of substantial Federal Reserve rate cuts in 2024, alongside some challenges in an otherwise solid Q1 earnings season.
$CRM (Salesforce Inc) shares fell after the company's Q1 report and guidance missed Wall Street's expectations, while $DELL (Dell Technologies Inc C) dropped after issuing soft margin guidance.
The April PCE inflation report was released on Friday. The Fed's official target, the 12-month Core PCE, held steady at 2.8% from March. Although the inflation data aligned with consensus estimates, spending within the report was slightly lower than anticipated.
Chris Zaccarelli, chief investment officer at Independent Advisor Alliance, highlighted the cautious sentiment, stating, "We are in a be-careful-what-you-wish-for moment because if slowing consumer spending leads to lower inflation and the Fed is able to cut slowly as a result, then that will be good for markets." He added, "But if consumer spending – and the economy – slows too quickly, then corporate profits and stock prices will go down much more quickly than the Fed will be able to cut rates, so we would be careful at this point."... Show More
