Wall Street Closes Lower As Inflation Data Keeps Fed Rate Cuts in Question

Wall Street closed lower on Friday after U.S. economic data pointed to persistent inflationary pressures, with all three major indexes ending the session in the red. The Dow Jones Industrial Average fell 0.21% to 53,463.88 points, the S&P 500 slipped 0.02% to 7,675.70 points, and the Nasdaq Composite declined 0.08% to 26,130.20 points. Data released Friday showed the U.S. economy grew 1.5% in the second quarter, in line with expectations.

Personal consumption expenditures rose 0.2% month-over-month in July, exceeding market forecasts. The core personal consumption expenditures price index — the Federal Reserve's preferred inflation gauge, which excludes food and energy — rose 0.2% month-over-month and 3.3% year-over-year in July. The macroeconomic figures revealed that inflation remains elevated.

Following the data, the yield on the 10-year U.S. Treasury note rose 3 basis points to 4.67% before settling at 4.65%. Chipmaker Nvidia's upcoming earnings report was in focus, with its shares closing down 1.6% on the day. Analysts said Nvidia's financial results could be decisive for the direction of technology stocks. Separately, Meta said it reached a settlement with U.S. regulators over a privacy dispute, but the company did not disclose the terms of the agreement.