U.S. Stocks Slip as Investors Take Profits; PCE Inflation Data in Line With Forecasts
U.S. stocks moved lower on Friday, retreating from record highs as investors locked in profits after a strong month. The pullback came despite limited signs of excessive inflationary pressures.
At 09:35 ET (13:35 GMT), the Dow Jones Industrial Average was down 70 points, or 0.2%. The S&P 500 slipped 16 points, or 0.3%, while the NASDAQ Composite fell 98 points, or 0.5%.
Even with the day’s decline, all three major indices remain on track for healthy monthly gains. The Dow is up 3.4% in August, reaching fresh record highs. The S&P 500 has advanced 2.6%, also at an all-time peak, while the Nasdaq has gained 2.8% this month.
Inflation Data Matches Estimates
New data showed the core PCE price index—the Federal Reserve’s preferred inflation gauge—rose 0.3% in July, bringing the annual rate to 2.9%, the highest in five months. This matched expectations, indicating that President Donald Trump’s tariffs have not significantly fueled consumer price pressures, despite recent surprises in producer inflation.
Michael Lorizio of Manulife Investment Management said the data supports the case for a September Fed rate cut, noting inflation is unlikely to block such a move.
The Fed, which cut rates by a full percentage point last year, has held steady in 2025 due to concerns tariffs could push inflation higher. Chair Jerome Powell recently acknowledged the possibility of a September cut, citing labor market weakness, though he stopped short of committing to further easing given tariff-related uncertainties.
Corporate Movers
- Dell Technologies (NYSE: DELL) fell after issuing weak guidance that overshadowed otherwise strong earnings.
- Marvell Technology (NASDAQ: MRVL) slumped on disappointing forecasts.
- Caterpillar (NYSE: CAT) declined after warning of higher tariff-related costs in 2025.
- Autodesk (NASDAQ: ADSK) jumped on strong quarterly results.
- Ulta Beauty (NASDAQ: ULTA) rose after boosting its annual outlook on strong demand for cosmetics and skincare.
- Affirm Holdings (NASDAQ: AFRM) surged as revenue beat estimates, lifted by resilient consumer spending.
Oil Prices Head for Weekly Gains, Monthly Losses
Crude oil prices slipped but remained on course for weekly gains. Brent futures fell 0.3% to $67.81 per barrel, while U.S. West Texas Intermediate (WTI) dropped 0.3% to $64.40.
Both benchmarks are set to gain just under 1% for the week, supported by concerns over Russian supply disruptions after Ukrainian attacks on oil terminals. However, the lack of progress in peace talks and the end of the U.S. summer driving season weighed on demand expectations.
For the month, Brent and WTI are both down over 6%, pressured by OPEC’s steady production increases.
