NEW YORK (AP) — Wall Street is flirting with a record Friday, as U.S. stock indexes drift following some mixed profit reports from big companies.
The S&P 500 was virtually unchanged in early trading, a day after rallying within 0.1% of its all-time high set last month. It’s sitting at 6,115.68, just below its record closing level of 6,118.71. The Dow Jones Industrial Average was down 44 points, or 0.1%, as of 9:37 a.m. Eastern time, and the Nasdaq composite was basically flat.
Airbnb charged 12.3% higher after reporting stronger profit for the latest quarter than analysts expected as customers booked more nights on its platform. It joined a long list of companies to top expectations this reporting season, which is usually the case.
It and other such companies helped offset a 6% drop for Applied Materials. The company, whose products help make semiconductor chips, displays and other tech, also reported stronger profit for the latest quarter than analysts expected. But it gave a forecasted range for upcoming revenue whose midpoint fell short of Wall Street’s expectations.
In the bond market, Treasury yields fell after a report said sales at U.S. retailers weakened by much more last month than economists expected. Bad weather, including bitingly cold temperatures in the South and devastating wildfires in California, may have helped keep shoppers away from stores and auto dealerships.
The yield on the 10-year Treasury fell to 4.47% from 4.54% late Thursday.
The hope among investors has been for such economic data to ease into a Goldilocks level, where it’s not so weak that it raises worries of a downturn but not so strong that it creates upward pressure on inflation.
This past week hit Wall Street with a couple disappointing reports that showed inflation unexpectedly accelerated last month.
Besides squeezing tighter on U.S. households’ budgets, stubbornly high inflation is likely to keep the Federal Reserve on hold for a while when it comes to providing relief to Americans through lower interest rates.
The Fed had cut its main interest rate sharply from September through the end of last year, intending to make borrowing cheaper, help the economy and boost prices for stocks, bonds and other investments. But the Fed warned at the end of 2024 it may not cut rates by as much in 2025 because of worries about inflation staying stubbornly high. Its goal is to keep inflation at 2%, and lower rates can give inflation more fuel.
Inflation may feel more upward pressure from tariffs that President Donald Trump has announced recently. So far, though, the U.S. stock market has largely been taking such threats in stride. Belief is strong that Trump is using tough talk to drive negotiations, but he may not fully go through with it in order to avoid damaging the U.S. stock market and economy.
Such equanimity, of course, could be dangerous if things don’t go according to Wall Street’s expectations, or if it emboldens Trump to make even forceful moves.
In stock markets abroad, indexes were mixed across Europe and Asia.
Hong Kong’s Hang Seng surged 3.7% for one of the biggest moves. Technology stocks were particularly strong, including big rallies for video games firm Tencent, smartphone maker Xiaomi and e-commerce firm Alibaba.
___ AP Writers Matt Ott and Zen Soo contributed.