Stocks ended mixed on Friday but ended the week with strong gains, driven by investor confidence in an imminent rate cut and strong AI and broad tech sector momentum. The Dow Jones Industrial Average (DJIA) rose 0.95%, while the S&P 500 (SPX) jumped 1.59%, its fifth positive week in the last six, and the Nasdaq-100 (NDX) rallied 1.86% for its second winning week in a row. Thursday brought the bullish trifecta, with all three key indexes reaching fresh records – so it was no surprise that Friday saw a pullback on heavy profit-taking amid heightened investor nerves as stock market bubble headlines resurfaced again.
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The Fed’s 0.25% rate cut this week has been fully priced in – with some anticipating a 0.50% reduction – following the recent batch of economic data. While CPI edged higher in August revealing some price stickiness in tariff-sensitive categories – the print came in mostly in line with consensus, following a weaker-than-expected wholesale inflation report.
Meanwhile, the job market continued to signal weakness with a sharp jump in weekly unemployment claims to a four-year high. This followed the softer-than-expected jobs report that showed U.S. job growth weakening sharply in August and the unemployment rate increasing to nearly a four-year high of 4.3%. On top of that, the Bureau of Labor Statistics revised down payroll gains for the year through March by almost a million – which showed that job growth was already stalling before Trump’s policies such as tariffs kicked in. Beyond that, the UoM consumer sentiment index fell to its lowest since May, reflecting growing concerns among households regarding labor markets and inflation.
Weaker labor market and declining consumer sentiment are helping shift the narrative from stagflation worries to an easing monetary cycle. The Fed has been clear in recent weeks that it is more focused on the weakening labor market than on any persistent inflation risk, and the latest data provided solid evidence that Jerome Powell’s recent dovish stance is well-based.
Three Economic Reports
This week, all eyes will be on the Federal Reserve’s policy meeting on Wednesday. However, economic data also remains in focus. Here are three key economic reports that could affect your portfolio this week. For a full listing of additional economic reports, check out the TipRanks Economic Calendar.
» September NY Empire State Manufacturing Index – Monday, 09/15 – This survey measures manufacturing activity in New York State, covering new orders, shipments, employment, and business sentiment. Although geographically limited, it is viewed as an early indicator of national manufacturing trends and provides timely insight into demand conditions, supply chain pressures, and the near-term outlook for economic growth.
» August Retail Sales – Tuesday, 09/16 – This report measures consumer spending on durable and nondurable goods. Retail sales serve as a leading indicator of economic health, offering insight into current quarter growth trends as well as inflationary pressures from household demand.
» August Industrial Production – Tuesday, 09/16 – This report tracks output across U.S. manufacturing, mining, and utilities. While industrial production represents a smaller share of overall economic activity than services, its responsiveness to demand shifts and interest rates makes it a useful gauge of GDP momentum and broader economic performance.
For more exclusive market insights and content from TipRanks Macro & Markets research analyst Yulia Vaiman, click here.
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