US stock futures were mixed on Friday following the release of the Federal Reserve’s preferred inflation reading, which showed inflation cooled in November.
Dow Jones Industrial Average (^DJI) futures fell 0.3%, while S&P 500 (^GSPC) futures hovered just abovethe flatline after leading stocks’ recovery from a sharp sell-off. Contracts on the tech-heavy Nasdaq 100 (^NDX) were up 0.1%.
Despite the recent pause in the rally, an eighth straight week of gains is still within stocks’ grasp on Friday — even if the rises are likely to be slight. The S&P 500 is eyeing a fresh all-time high thanks to investors’ faith that the Federal Reserve will soon start bringing down borrowing costs.
A fresh read on the PCE index showed that prices excluding the volatile categories of food and energy rose 3.2% in November from a year earlier, down from October’s revised annual gain of 3.4%. Analysts had expected a 3.3% annual increase.
In individual stock moves, Nike (NKE) shares sank 12% in premarket trading after the company warned it would cut jobs and expected sales to falter, thanks to weaker consumer spending. Shares of other sportswear makers fell in the wake of its revenue forecast cut.
Elsewhere, Tencent shares (0700.HK) (TCEHY) plunged to lead an $80 billion sell-off in some of China’s biggest online names. Fears of another tech crackdown reignited after Beijing unexpectedly imposed new rules on gaming.
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Inflation continued cooling in November
Price increases slowed in November, according to a fresh reading of the Federal Reserve’s preferred inflation gauge.
Core PCE rose 3.2% over the year, down from October’s revised annual gain of 3.4%. The increase was lower than the 3.3% gain expected by analysts.
On a monthly basis, core PCE — which excludes the volatile categories of food and energy — ticked up 0.1%, flat compared to October’s revised monthly gain.
Investors were closely watching the data’s release for signs of how quickly the central bank could bring down interest rates next year. The Fed signaled earlier this month that it would cut interest rates three times next year.
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