Investors fretted over persistently high inflation and the Federal Reserve's future rate-hike plans Friday, which sent most stocks lower into the long holiday weekend.
(For those wondering "is the stock market open on Presidents' Day," which is this Monday, Feb. 20, the answer is no.)
And while the Dow managed to outperform its fellow indexes today on strength in healthcare stocks Amgen (AMGN) and Merck (MRK), it still finished the week with an unwelcome milestone.
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Wall Street's ramped up worries over more rate hikes from the Fed came courtesy of this week's higher-than-expected January inflation readings. The market is now pricing in a quarter-point increase in interest rates at each of the central bank's next three gatherings, with the next Fed meeting occurring in late March.
Several Fed speakers this week have suggested more aggressive rate hikes in order to tame inflation. Speaking at the Tennessee Bankers Association in Nashville earlier today, Fed Governor Michelle Bowman – a voting member of the Federal Open Market Committee (FOMC) – said the central bank is not seeing what it needs to be seeing, "especially in terms of inflation." The Fed has "to continue to raise the federal funds rate until we start to see a lot more progress on that," she added.
In single-stock news, DraftKings (DKNG) stock jumped 15.3% after the sports betting platform said fourth-quarter revenue was up 81% year-over-year to $855 million, more than analysts were expecting. The company also reported a slimmer-than-anticipated per-share loss of 53 cents, and raised its full-year forecast. DoorDash (DASH) was another big post-earnings mover, though its shares fell 7.6% after the food delivery company reported a wider-than-expected Q4 loss. Next week's earnings calendar heats up, with a number of retailers set to report, including Home Depot (HD) and Walmart (WMT).
At the close, the Nasdaq Composite was off 0.6% at 11,787 and the S&P 500 was 0.3% lower at 4,079. The Dow Jones Industrial Average rose 0.4% to 33,826. Both the S&P 500 and Dow finished lower for the week, with the latter notching a third straight weekly loss – the longest such streak since September.
The best commodity ETFs to buy
Crude futures and gold ended lower on the week in what has been a rough stretch for the commodities market. Commodities rallied to start the year thanks to a weaker dollar, as well as "a cooling U.S. economy, a resurgent China and a recovering Europe," says Goldman Sachs economist Jeffrey Currie. More recently, though, a rising dollar, stronger-than-expected U.S. economic data and "a seasonal slowdown in China's economy" have created headwinds for oil and metals.
Still, Currie believes "fundamentals will rebound this spring" and maintains a bullish outlook on commodities. Investors sharing the same sentiment can find plenty of opportunities among the best energy stocks or the top gold stocks. And for a broader approach, these are the best commodity ETFs to buy now.
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