Stock market news for May 10, 2024

The Dow Jones Industrial Average rose on Friday, wrapping an eighth consecutive winning session and registering its best week of 2024.

The 30-stock index added 125.08 points, or 0.32%, to close at 39,512.84. The S&P 500 climbed 0.16%, ending at 5,222.68, while the Nasdaq Composite inched lower by 0.03% to end at 16,340.87.

The major averages also wrapped the week on a high note. The Dow posted a 2.16% gain for the period, its best week since December and its fourth positive week in a row. The S&P 500 and the Nasdaq Composite both posted a third consecutive winning week, rising 1.85% and 1.14%, respectively.

Investor enthusiasm was kept in check after consumer sentiment data released Friday morning showed a big uptick in inflation expectations.

The preliminary May reading for the University of Michigan’s consumer sentiment index came in at 67.4, far below a Dow Jones estimate of 76 and marking its lowest reading in about six months.

The data could indicate that “inflation is not moving in the right direction either,” said Brian Nick, senior investment strategist at the Macro Institute. “You get hit from both sides — people think things are worse than the economy and they’re going to stay worse, and they’re worried about inflation. And that’s not a happy formula for stocks or bonds.”

The Federal Reserve’s rate-cutting path will be further influenced by how much of a slowdown is seen in consumer spending and in hiring, Nick added. “If those things don’t seem like they’re completely falling off the cliff, that’s good enough news for markets that are just kind of starved for rate cuts,” he said.

Investors have been more optimistic lately after the Fed indicated the next move is unlikely to be a hike, pointing to a cap on interest rates that could be bullish for equities. Cooler labor data has also raised traders’ confidence in the outlook for this year.

However, markets will be put to the test next week when April’s consumer price index reading is released.