(Sharecast News) - Major indices closed higher on Friday as market participants digested key inflation data, disappointing fourth quarter GDP figures and a Supreme Court decision on Donald Trunp's sweeping tariff regime.
At the close, the Dow Jones Industrial Average was up 0.47% at 49,625.97, while the S&P 500 advanced 0.69% to 6,909.51 and the Nasdaq Composite saw out the session 0.90% firmer at 22,886.07.
The Dow closed 230.81 points higher on Friday, taking a bite out of losses recorded in the previous session after December's blowout trade deficit.
Friday's primary focus was news that US economic growth slowed sharply at the end of 2025 while inflation remained stubborn - a combination that will likely complicate the Federal Reserve's path on interest rates.
According to the Bureau of Economic Analysis, fourth‑quarter gross domestic product rose at an annualised rate of just 1.4%, well below the 2.5% expected by economists, marking a clear loss of momentum from the 2.8% expansion recorded across 2024 and the stronger‑than‑forecast performance seen earlier in 2025. Full‑year growth eased to 2.2%.
At the same time, inflation stayed firm, with core personal consumption expenditures, the Federal Reserve's preferred inflation gauge, excluding food and energy, rising 3% year‑on‑year in December, matching expectations but remaining well above the central bank's 2% target. Headline PCE accelerated to 2.9%, slightly hotter than forecast. Both measures increased 0.4% on the month, compared with consensus estimates of 0.3%.
The data landed shortly after Donald Trump warned that GDP would come in soft, blaming the weakness on the government shutdown that ended in November.
"The Democrat Shutdown cost the USA at least two points in GDP. That's why they are doing it, in mini form, again. No Shutdowns!" Trump said on social media. "Also, LOWER INTEREST RATES. "Two Late" Powell is the WORST!!!"
Elsewhere on the macro front, US business activity lost momentum in February, with S&P Global's flash PMI readings pointing to the slowest pace of private‑sector growth in nearly a year. S&P's manufacturing PMI slipped to 51.2 from 52.4 in January, missing expectations for 52.6 and marking the weakest improvement in seven months, while the services PMI also eased, falling to 52.3 from 52.7, below forecasts for a rise to 53 and signalling the softest expansion in the sector in ten months. As a result, the composite PMI dropped to 52.3 from 53.0, its lowest level since April 2025.
On another note, consumer sentiment was revised slightly lower in February, according to the University of Michigan's latest survey, though confidence remained at its highest level since August 2025. The headline index was marked down to 56.6 from the preliminary 57.3, little changed from January's 56.4. The report showed minimal movement across all major components, indicating that households saw few changes in broader economic conditions over the month. Inflation continued to weigh on sentiment, with 46% of respondents citing high prices as a strain on personal finances - the seventh straight month that the figure has remained above 40%.
Finally, new‑home sales eased slightly in December but remained close to a four‑year high, according to the Commerce Department, which revealed sales of new single‑family homes fell 1.7% to an annualised 745,000 units, down from November's peak but comfortably ahead of the 730,000 expected by economists. December's figure marked the second‑strongest reading of the year, underscoring ongoing resilience in the housing market despite higher mortgage rates.
Market participants were also locked in on news that the US Supreme Court ruled that Donald Trump had exceeded his authority when imposing sweeping tariffs under emergency‑powers legislation. In a 6-3 decision, the court found that the International Emergency Economic Powers Act "does not authorise the President to impose tariffs", striking down the measures.
The ruling saw the three liberal justices - Ketanji Brown Jackson, Elena Kagan and Sonia Sotomayor - joined by conservatives Amy Coney Barrett, Neil Gorsuch and Chief Justice John Roberts in the majority. Justices Brett Kavanaugh, Samuel Alito and Clarence Thomas dissented.
Geopolitics were also in focus after tensions between the US and Iran escalated, with Trump saying he will decide within 10 days whether or not he will move to authorise military strikes. Oil prices rose overnight amid fears of a potential conflict in the Middle East.
No major corporate earnings were released on Friday.
Reporting by Iain Gilbert at Sharecast.com
Dow Jones - Risers
Travelers Company Inc. (TRV) $304.60 1.68%
Procter & Gamble Co. (PG) $160.81 1.40%
Cisco Systems Inc. (CSCO) $79.20 1.30%
Verizon Communications Inc. (VZ) $49.29 1.25%
3M Co. (MMM) $166.66 1.22%
Coca-Cola Co. (KO) $79.75 1.18%
American Express Co. (AXP) $345.91 1.03%
Home Depot Inc. (HD) $381.54 0.97%
JP Morgan Chase & Co. (JPM) $310.86 0.89%
McDonald's Corp. (MCD) $329.01 0.65%
Dow Jones - Fallers
Intel Corp. (INTC) $44.11 -2.97%
Dow Chemical Co. (DOW) $30.51 -2.77%
Johnson & Johnson (JNJ) $242.35 -1.79%
Amgen Inc. (AMGN) $374.75 -1.31%
Boeing Co. (BA) $231.95 -0.72%
Microsoft Corp. (MSFT) $397.23 -0.59%
Chevron Corp. (CVX) $183.73 -0.46%
Walt Disney Co. (DIS) $105.63 -0.40%
Nike Inc. (NKE) $65.29 -0.32%
Caterpillar Inc. (CAT) $759.34 -0.10%
S&P 500 - Risers
Corning Inc. (GLW) $139.49 7.32%
eBay Inc. (EBAY) $88.07 7.17%
Under Armour Inc. Class A (UAA) $8.13 5.58%
Under Armour, Inc. (UA) $7.89 5.21%
Extra Space Storage (EXR) $152.69 4.56%
Alphabet Inc. Class A (GOOGL) $314.98 3.84%
Alphabet Inc. Class C (GOOG) $314.90 3.61%
PVH Corp. (PVH) $72.24 3.59%
Principal Financial Group Inc (PFG) $95.74 3.56%
Teleflex Inc. (TFX) $115.32 3.26%
S&P 500 - Fallers
Akamai Technologies Inc. (AKAM) $94.17 -13.85%
Affiliated Mgrs Group (AMG) $286.46 -10.72%
Oracle Corp. (ORCL) $148.12 -5.41%
Booking Holdings Inc. (BKNG) $4,076.79 -4.52%
Charter Communications Inc. (CHTR) $230.18 -3.75%
Western Digital Corp. (WDC) $285.52 -3.72%
Robert Half Inc. (RHI) $25.92 -3.63%
American Airlines Group (AAL) $13.59 -3.62%
Ipg Photonics Corp. (IPGP) $133.59 -3.39%
Copart Inc. (CPRT) $36.48 -3.36%
Nasdaq 100 - Risers
Qvc Group Inc Series A (QVCGA) $4.71 15.16%
eBay Inc. (EBAY) $88.07 7.17%
Alphabet Inc. Class A (GOOGL) $314.98 3.84%
Biomarin Pharmaceutical Inc. (BMRN) $64.08 3.64%
Alphabet Inc. Class C (GOOG) $314.90 3.61%
J.B. Hunt Transport Services Inc. (JBHT) $230.12 2.99%
PACCAR Inc. (PCAR) $128.46 2.63%
Amazon.Com Inc. (AMZN) $210.11 2.60%
Analog Devices Inc. (ADI) $355.03 2.50%
CSX Corp. (CSX) $42.31 2.30%
Nasdaq 100 - Fallers
Booking Holdings Inc. (BKNG) $4,076.79 -4.52%
Liberty Global plc Series C (LBTYK) $12.11 -4.42%
Charter Communications Inc. (CHTR) $230.18 -3.75%
Western Digital Corp. (WDC) $285.52 -3.72%
Liberty Global plc Series A (LBTYA) $12.55 -3.72%
Trip.com Group Limited (TCOM) $54.57 -3.64%
American Airlines Group (AAL) $13.59 -3.62%
Workday, Inc. (WDAY) $137.79 -3.39%
Gen Digital Inc. (GEN) $22.35 -3.25%
Paychex Inc. (PAYX) $91.25 -3.22%