US stocks moved back and forth on Friday as investors approached the end of a turbulent trading week marked by mixed retail earnings and a chorus of a hawkish Federal Reserve.
S&P 500 Index (^ The Salafist Group for Preaching and Combat(down by 0.1%, while the Dow Jones Industrial Average fell (^ DJI) rose 60 points, or 0.2%. Nasdaq Technology Heavy Composite (^ ix) slipped 0.6%. Treasury yields continued their climb, with the benchmark 10-year note returning above 3.8% and the 2-year rate-sensitive yield around 4.5%.
A meeting of Federal Reserve officials on Thursday dismissed speculation that a temporary pause in monetary tightening was imminent. The remarks, made in separate posts across the country, sent stocks and bonds into a tailspin after a fleeting bull run spurred by the softer inflation data.
Inflation only recently Showed signs of moderationwith the consumer and Product price data It remains stubbornly high despite pulling back in October. Meanwhile, the United States Retail sales rose at the fastest clip eight months over the same period, prompting policymakers to stress tough messaging about the work that still needs to be done to bring down soaring costs.
Minneapolis Federal Reserve Bank President Neel Kashkari said at a web event at the Minnesota Chamber of Commerce that the extent to which policymakers expect to raise their main federal funds rate It remains an open question. His comments came afterward St. Louis Federal Reserve Chairman James Bullard San Francisco Fed President Marie Daly said the central bank is looking at an interest rate of up to 5.25%.
“Federal Reserve Chair Powell recalibrated monetary policy at the November FOMC meeting by adopting a new velocity versus destination model — signaling the intent to reach a higher federal funds rate while doing so at a slower pace,” he said in a note. “The difficulty for the Fed will be to prevent excessive and reverse easing of financial conditions in the face of weaker-than-expected inflation.”
Goldman Sachs Group on Thursday, too It raised its forecast for the Fed’s final interest rate to a range of 5% to 5.25%, with a further increase of 25 basis points in May after increases of this magnitude in February and March and half a percentage point in December.
“Inflation is likely to remain uncomfortably high for a while, and this could put pressure on the FOMC to deliver a longer series of small hikes next year,” said economists led by Jan Hatzius.
Gap shares jumped 3% Friday after the company Unveil top results Wall Street estimates. However, Chief Financial Officer Katrina O’Connell stressed that the macroeconomic environment remains challenging, but that Gap will take a “prudent approach in light of the uncertain consumer.”
Shares of Ross Stores rose 18%, the most in two years, after The retail chain beat earnings expectations And it raised its guidance for the fourth quarter, noting sales momentum and improved holiday assortments.
Meanwhile, shares of home furnishings store Williams-Sonoma sank about 10% after that It withdrew its guidance through 2024 on “total uncertainty”.
Alexandra Semenova is a correspondent at Yahoo Finance. Follow her on Twitter @employee