US stocks backed off slightly on the final trading day of the week, after rocketing higher yrday amid renewed hope that progress in taming inflation will prompt the Federal Reserve to slow its interest rate increases.
About 20 minutes into Friday’s session, the Dow Jones Industrial Average had retreated 0.3 percent to 33,604.19, while the broad-based S&P 500 was about flat at 3,957.72, AFP reported.
The tech-rich Nasdaq Composite Index, the big winner the prior day, was up 0.3 percent to 11,151.2.
The rally Thursday was sparked after a closely watched government data report showed annual consumer price inflation eased to 7.7 percent in October, the lowest since January.
That could open the door for the central bank to be less aggressive in its moves to slow demand in the world’s largest economy.
“The huge gains were a manifestation of pent-up hope that inflation has peaked and that the ultra-aggressive nature of the Fed’s policy approach has also peaked,” said Briefing.com analyst Patrick J O’Hare.
While the Fed is not done raising interest rates “the market saw an opening in the October CPI report for the Fed to take a less aggressive approach” and perhaps not take borrowing rates as high as previously thought, O’Hare said in a commentary prior to the open.
The US central bank has increased the benchmark lending rate six times this year — including four consecutive super-sized hikes — as it tries to quash demand and rein in inflation which remains near a 40-year high.
