NEW YORK — U.S. equities held steady on Friday after a good report on inflation helped calm Wall Street, which has been worried about how artificial intelligence technology will change the economic sector.
The S&P 500 didn't move much, even though it suffered one of its worst days since Thanksgiving the day before. The Dow Jones Industrial Average went up 48 points, or 0.1%, while the Nasdaq composite went down 0.2%.
Stocks got a boost as Treasury yields fell after a report showed that inflation slowed down more than economists had thought it would last month. Overall, U.S. consumers paid 2.4% more on groceries, clothes, and other everyday goods than they did a year ago.
Even while that's more than anyone wants and more than the Federal Reserve's 2% target, it wasn't as dreadful as the 2.7% rate in December. And an underlying measure of inflation that analysts think is a better indicator of where it might be going slowed to the least unpleasant level in almost five years.
Brian Jacobsen, the chief economic strategist at Annex Wealth Management, said, "It's still too high, but only for now, not forever."
Slower inflation might also offer the Federal Reserve more room to lower interest rates if they need to. This would aid American families who are having trouble keeping up with the cost of living. The Fed has stopped cutting interest rates for now, but most people think it will start again later this year.
Lowering rates would help the economy and raise stock prices. The Fed doesn't want to decrease rates since they can make inflation worse.
The economy seems to be doing better now than it was at the end of 2025. In addition to inflation slowing down, the labor market became better last month by more than forecasters thought it would.
On Wall Street, stock prices stayed steady for a few companies that investors had thought may lose out because of AI disruption.
For instance, AppLovin lost about 20% of its value on Thursday, even though it made more money than analysts had predicted. Investors have been worried that AI-powered competitors could steal away consumers from it and other software companies, which would disrupt their industries in a big manner.
AppLovin went up 6.4% on Friday.
Trucking and freight businesses also fell on Thursday after Algorhythm Holdings, a small startup, announced that its AI platform enables customers boost the amount of freight they can handle by up to 400% "without a corresponding increase in operational headcount." C.H. Robinson Worldwide fell 14.5% on Thursday but rose 4.9% on Friday.
These kinds of dips have been happening a lot in the market lately, and they are aimed at businesses that investors think AI could disrupt. Analysts have compared the reactions to a "shoot first, ask questions later" attitude since they are so rapid and violent.
Applied Materials was the biggest single driver pushing the S&P 500 up, with an 8.1% rise. The company, which makes electronics and displays, made more money in the last quarter than analysts thought it would. Gary Dickerson, the CEO, said that "increased investments in AI computing" were to blame.
DraftKings was on the losing side of Wall Street, shedding 13.5% of its value even though its profit for the last quarter was more than analysts had expected. It made a prediction for this year's revenue that was lower than expected.
Norwegian Cruise Line Holdings' stock dropped 7.6% when it changed its CEO. This happened only a few weeks before the company was set to release its latest quarterly results. The cruise line claimed that John Chidsey, a director of the firm who used to be CEO of Subway Restaurants, is taking over for Harry Sommer right away.
Nvidia had the most weight on the market, and it plummeted 2.2%. The S&P 500 reacts more to its moves than to any other company's since it is the biggest stock on Wall Street.
The S&P 500 ended its weakest week since November with a gain of 3.41 points, bringing it to 6,836.17. The Dow Jones Industrial Average went up 48.95 points to 49,500.93, while the Nasdaq composite went down 50.48 points to 22,546.67.
The yield on the 10-year Treasury note dipped from 4.09% late Thursday to 4.05% on Friday. The yield on the two-year Treasury, which is more closely related to what people think the Fed will do, fell much further. It went down from 3.47% to 3.40%.
In Asia, stock market indexes dipped, while in Europe, they were more mixed. The Hang Seng in Hong Kong sank 1.7%, and the Nikkei 225 in Japan fell 1.2%. These were two of the biggest changes.__
