Wall Street fell slightly early on Friday, but was still clinging to early-week gains as markets awaited important data on the state of the U.S. economy.
The S&P 500, Dow Jones Industrial Average and Nasdaq futures all fell 0.2% before the opening bell.
A government report on inflation and gross domestic product will be released late Friday morning. Friday’s consumer spending report includes a measure of inflation recommended by the Federal Reserve, which could influence the central bank’s next interest rate move.
If indicators of inflation rise, Fed officials could keep interest rates on hold for the second time this year, fearing that cutting rates will cause prices to rise further. The decision to keep interest rates unchanged may be supported by recent employment data, particularly the January employment report, which was stronger than expected.
At the same time, the government will release its first estimate of the fourth quarter’s gross domestic product (GDP), which reflects the country’s output of goods and services. Analysts expect economic growth to show in the range of 1.9% to 3.5%. A positive report could prompt Fed officials to keep interest rates unchanged, fearing that low-interest loans will overheat the economy.
Fed officials said at their last meeting that they wanted to review the situation. Inflation will fall further before they support further rate cuts this year.
European stocks rose as of midday Friday on concerns about risks associated with large investments, after mixed trading in Asian markets. artificial intelligence A potential conflict between the US and Iran also weighed on key indicators.
Germany’s DAX was up 0.2% as of midday, Paris’ CAC40 index was up 0.8% and Britain’s FTSE 100 index was up 0.5%.
Tokyo’s Nikkei Stock Average fell 1.1% to 56,825.70 yen, as shares of major banks and other financial institutions plunged on concerns about the potential impact of weakening private credit companies that lend to companies at risk of losing business to AI.
These include market heavyweights such as Mitsubishi UFJ Financial Group, which is affiliated with Blue Owl Capital, a private credit company. MUFJ shares fell 2.2% in Tokyo after Blue Owl fell 5.9% on Thursday.
Toyota Motor Corporation fell 3.7% and Sony fell 3.2%.
In Hong Kong, the Hang Seng fell 1.1% to 26,413.35 as markets reopened after the Lunar New Year holiday. Markets in mainland China and Taiwan will be closed until next week.
However, South Korea’s Kospi soared 2.3% to a new record of 5,808.53, led by major defense contractors such as Hanwha Aerospace whose shares soared 6.4%. The company is one of the companies benefiting from increased military spending in many countries.
Elsewhere in the region, Australia’s S&P/ASX 200 index fell 0.1% to 9,081.40.
In energy markets, oil prices fell a day after soaring to their highest since early August on growing concerns that the United States and Iran were headed for conflict.
Early Friday morning, benchmark U.S. crude pared early gains and fell 34 cents to $66.06 a barrel. The international standard Brent fell 36 cents to $71.30 a barrel.
Gold prices rose less than 1%, while silver rose 3.4%.
Bitcoin remained steady, rising less than 1% to $67,513.
