4:05pm: Dow wins the day
US stocks were a mixed bag by Friday's close, with the Dow emerging as the only winner.
At the close, the Dow had eked out a gain of 0.3% to finish at 34,509 points, while the S&P 500 had lost 0.1% at 4,505 and the Nasdaq was down 0.2% at 14,114.
Overall it was a positive week for the major US indices, as softer US inflation pushed stocks generally higher.
“Stocks finished the week on a high as softer U.S. consumer and producer price inflation increased hopes for a soft landing and bolstered risk appetite," IG's Rudolph noted.
Meanwhile, upcoming data is likely to hint at a softening growth story though this is unlikely to deter the Federal Reserve from tightening policy again this month.
"The recent softer private sector jobs growth and lower-than-expected inflation data have seen expectations for the terminal Fed funds rate move lower in recent days," analysts at ING opined.
"Nonetheless, the Fed still believes it needs to do more policy tightening to ensure inflation returns to 2% and stays there. We fully expect a further 25bp rate hike from the Federal Reserve on 26 July but doubt that policymakers will carry through with the second hike that they envisioned in their recent forecasting round."
12:05pm: Upbeat 2Q results boost equities
US stocks were higher in noon trading following better-than-expected 2Q financial results from some big American banks.
At midday, the Dow gained 129 points to 34,524, while the S&P 500 added 7 points at 4,518 and the tech-heavy Nasdaq rose 43 points to 14,182.
“Friday's University of Michigan consumer sentiment, the highest in nearly two years, and better-than-expected earnings by the likes of JPMorgan Chase, Wells Fargo and UnitedHealth propped up stock indices,” IG senior market analyst Axel Rudolph said.
Notable movers included shares of JPMorgan Chase & Co, which rose as much as 3% after the big bank beat estimates with its 2Q financial results, helped by higher interest rates and better-than-expected bond trading numbers.
9:40am: Stocks move higher on earnings
US stocks moved higher at the open on Friday as big bank earnings kicked off the second quarter earnings season.
Just after the market opened, the Dow Jones was up 153 points or 0.4% at 34,548 points, S&P 500 had added 11 points or 0.2% at 4,521 points, and the Nasdaq had gained 40 points or 0.3% at 14,179 points.
FOREX.com analyst Joshua Warnter noted that stocks were pushing higher “after an impressive start to the second quarter earnings season, with major banks beating expectations and praising the strength of the US economy as markets become more hopeful that inflation is easing, interest rates are nearing their peak and that a severe recession can be avoided.”
Shares of JPMorgan and Wells Fargo rose 1.4% and 3.1% respectively on their largely positive results, while Citi traded modestly lower, down 0.2%.
7:45am: Big bank earnings ahead
US stocks are expected to start mixed on Friday after recent strong gains following benign inflation reports, as investors eye earnings reports from a number of big banks.
JPMorgan, Wells Fargo, Citi, BlackRock and State Street are all scheduled to report second-quarter earnings Friday morning. UnitedHealth will also release its latest quarterly update.
In pre-market trading, futures for the Dow Jones Industrial Average (DJIA) were 0.5% higher, while those for S&P 500 were up 0.1% and futures for the Nasdaq 100 were flat.
On Thursday, the DJIA rose a modest 47 points, or 0.1%, to close at 34,395, while the S&P 500 climbed 0.9%, and the Nasdaq Composite jumped 1.6%, lifted by strong gains for tech giants Nvidia and Alphabet.
Thursday was the fourth consecutive day of gains for the major averages and marked the highest closes for the Nasdaq and the S&P 500 since April 2022.
On a weekly basis to Thursday, the DJIA is up 1.9%, while the S&P 500 is ahead 2.5%, and the Nasdaq Composite has notched up gains of 3.5% and is on pace for its best week since March 17 this year.
The latest producer price index report released on Thursday showed wholesale inflation rose less than anticipated and built on investor optimism from the below-forecast June consumer price index data, which came out on Wednesday.
Ipek Ozkardeskaya, senior analyst at Swissquote Bank commented: "We are having a great week in terms of US inflation news. After Wednesday’s data showed that the US headline inflation slowed to 3%, and core inflation fell to 4.8% - both lower than what analysts had penciled in, yesterday’s producer price inflation data also came in lower than expected.
"The monthly PPI eased to 0.1%, perhaps the last positive figure we see before sinking into negative territory in the coming months, and core PPI fell to 2.6%. One more good news, some underlying details in the PPI report, including health care and hotel accommodations, are used to compute the Fed’s favourite PCE Price Index that will be released in the coming weeks – which could also benefit from softening inflation trend."
On the economic front on Friday, investors will be watching for June import prices and preliminary July results from the latest University of Michigan consumer sentiment report, both due out after the New York market open.