STORY: Wall Street Sees Gains After Inflation Data, Yet Weekly Decline Persists

December 21, 2024 - 02:05

After a tumultuous week, Wall Street's major indexes experienced a rally on Friday, buoyed by inflation data that came in cooler than anticipated, alleviating concerns regarding the trajectory of interest rates. The Dow, S&P 500, and Nasdaq all recorded gains exceeding one percent. The personal consumption expenditures (PCE) price index indicated a 2.4% year-over-year increase in inflation for November, which was below economists' forecasts.

This report followed the Federal Reserve's announcement earlier in the week, which projected only two interest rate cuts for 2025, leading to a sharp sell-off in equities that left markets struggling on Thursday. Alexander Morris, CEO and CIO of F/m Investments, noted that Friday's gains provided a much-needed reprieve after a challenging week. He emphasized the Fed's focus on inflation data as a critical factor in their decision-making process.

However, despite Friday's uptick, the Nasdaq ended a four-week winning streak, while the S&P 500 experienced its largest weekly percentage drop in six weeks. The Dow also faced its third consecutive weekly decline. Notable stock movements included a nearly 18% drop in Novo Nordisk after disappointing results from a late-stage trial for its obesity drug, while Eli Lilly's shares rose following FDA approval of its weight-loss treatment for obstructive sleep apnea.