Stocks close higher Friday after in-line inflation data, but S&P 500 snaps 3-week winning streak

Stocks climbed on Friday, but still finished the week lower following the release of crucial inflation data.

The Dow Jones Industrial Average advanced 299.97 points, or 0.65%, to close at 46,247.29. The S&P 500 added 0.59% to close at 6,643.70, while the Nasdaq Composite rose 0.44% to settle at 22,484.07.

Friday’s rally snapped a three-day losing streak for the major indexes, but still ended the week down. The Nasdaq Composite and S&P 500 slid 0.7% and 0.3%, marking each index’s first losing week in four. The Dow shed 0.2%.

August’s personal consumption expenditures price index, the Federal Reserve’s preferred inflation measure, showed that core inflation – a measure excluding food and energy costs – ran at a 2.9% seasonally adjusted annual rate. That was in line with what economists polled by Dow Jones were expecting.

The all-items index showed an annual rate of 2.7% as well as a monthly gain of 0.3%, in line with expectations as well. Markets continue to price in two quarter-point rate cuts at the Fed’s upcoming meetings, per the CME FedWatch tool, which is what the central bank has projected.

The outcome swayed market reaction a bit, with stock futures ticking higher, and came on the heels of solid jobs data released Thursday and a strong upward revision in second-quarter gross domestic product to 3.8% that slightly dampened bullish sentiment. Investors fear fewer jobless claims could mean that the economy is in decent shape and therefore will give the Fed less reason to cut interest rates.