On Friday, U.S. equity indexes displayed a mixed performance during midday trading as investors carefully assessed the Federal Reserve's preferred inflation metrics for July. The S&P 500 index noted a slight increase of 0.1%, reaching 5,598.9, while the Nasdaq Composite advanced by 0.2%, settling at 17,554.5.
In contrast, the Dow Jones Industrial Average experienced a decline of 0.2%, dropping to 41,248.3 after briefly trading higher earlier in the session. In the bond market, most Treasury yields witnessed an uptick, with the yield on the 10-year note rising by 4 basis points to 3.90%. Meanwhile, the two-year yield climbed 1.5 basis points higher to 3.91%.
From an economic perspective, the Personal Consumption Expenditures (PCE) price index rose by 0.2% in July, in line with expectations. This followed a modest 0.1% gain in June. Notably, the year-over-year inflation rate held steady at 2.5%, unchanged from the previous month. The core PCE price index, which excludes volatile food and energy prices, also experienced a month-over-month increase of 0.2% for the second consecutive month, consistent with forecasts.
The year-over-year core inflation rate remained at 2.6% for the third month in a row, highlighting persistent inflationary pressures. In business sentiment, the Institute for Supply Management's Chicago Purchasing Managers' Index (PMI) saw an improvement, increasing to 46.1 in August from July's reading of 45.3.
This was above the anticipated figure of 44.8, indicating a contraction in the manufacturing sector despite the positive surprise. This contraction theme was echoed across all regional manufacturing data and the S&P Global flash estimate. Consumer sentiment showed a modest upward revision, with the University of Michigan's index for August being adjusted to 67.9 from an initial estimate of 67.8, against expectations of a slight increase to 68.1.
Turning to corporate news, Intel Corporation ($INTC) is collaborating with Morgan Stanley ($MS) and Goldman Sachs Group ($GS) to strategize during challenging operational conditions, as reported by Bloomberg News. Following this news, Intel shares surged by 8.4%, making it one of the top gainers on the S&P 500, Nasdaq, and Dow indices. In another notable development, MongoDB's ($MDB) fiscal Q2 results indicated what the management describes as "some stabilization" in operations after a tumultuous start to 2024.
Truist Securities emphasized that this stabilization can be viewed as an operational rebound. Consequently, MongoDB shares skyrocketed by 17% intraday, marking it the best performer on the Nasdaq for the day. In commodity markets, West Texas Intermediate crude oil prices suffered a decline, slumping 2.7% to $73.86 per barrel, reflecting the ongoing volatility in the energy sector as traders digest global supply and demand dynamics. In summary, these market movements and economic indicators reflect a complex interplay between inflation concerns, corporate performance, and consumer sentiment, setting the stage for the next phase of market activity as investors navigate a challenging economic landscape..