Markets rise
US stocks moved higher on Friday as investors prepared for the release of the Personal Consumption Expenditures (PCE) price index. This is the Fed’s most important inflation measure. The S&P 500 gained 0.3%. The Nasdaq rose 0.4%, and the Dow Jones Industrial Average added about 0.2%. The PCE report was delayed due to the recent government shutdown. Analysts say this report could shape the Federal Reserve’s plan for interest rates at its meeting next week. Investors are also waiting for new data on personal income, personal spending, and consumer sentiment.
Possible Fed rate cut
Market data showed that traders now expect an 87% chance of a quarter-point rate cut next Wednesday. One month ago, the expectation was only 62%. This change reflects growing confidence that inflation is slowing. It also shows that investors believe the Fed may begin easing policy after months of high interest rates. Bond yields moved slightly as traders prepared for possible changes in policy. Analysts said the overall tone of the market was hopeful but still careful.
Mixed signals
New labor numbers gave a mixed picture of the US economy. Companies cut 71,000 jobs in November. This was the largest November job-cut total since 2022. But weekly jobless claims fell to their lowest level since September 2022. This suggests that while hiring may be slowing, the job market is not collapsing. Economists said the numbers show a slow cooling process. This may give the Fed space to adjust interest rates without causing sudden economic problems. Investors also saw the data as evidence that the economy is not heading into a sharp downturn.
Other stocks
Netflix’s announcement of a $72 billion deal to buy Warner Bros. Discovery (WBD) was one of the biggest corporate stories of the day. The deal includes the company’s studios and streaming units. Netflix shares fell more than 2% as investors reacted to the size of the purchase. WBD shares rose about 2% after the news.
Steady but cautious
Analysts said markets are steady but alert. The PCE report could shift expectations for the Fed’s next steps. A soft reading may support hopes for a rate cut, while a strong reading could create new pressure. For now, investors are watching inflation, jobs, and earnings as they prepare for the final stretch of December trading.
