The Dow Jones Industrial Average closed Friday’s trade 1% lower. Higher inflation numbers early Friday increased the chances of interest rates staying higher for longer.

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The S&P 500 also fell 1% at the close. Nasdaq’s fall was greatest when the technology-heavy index plunged 1.7 per cent. The small-cap Russell 2000 also fell 1%.

Volume on the NYSE and Nasdaq was lighter, according to preliminary closing data.

Crude oil rose over 1% to trade at $76.51 a barrel.

The yield on the 10-year Treasury note rose 7 basis points to 3.95% after the personal consumption expenditures, or PCE, price index rose 0.6% in January and 5.4% from a year ago. These readings were higher than expected, fueling fears of continued rising prices.

Real consumption rose 1.1% in January after a decline in December. Good news is bad news as recession fears fade with a more robust GDP forecast for 2024. Meanwhile, the likelihood of a longer period of high interest rates increases.

Comerica Chief Economist Bill Adams sees “The Fed raising its target for federal funds to a peak level of 5.25% to 5.50% in June and holding it at that level until a first rate cut in the March 2024 decision.”

In stock, Chipotle Mexican Grill (CMG) extended a slide and fell below its 200-day moving average. The fast-casual burrito chain has triggered the 7% sell signal as the Jan. 31 breakout fails.

Dow Jones leaders on guard

Among Dow stocks, Salesforce (CRM) is in a cup with handle approaching a buy point at 178.94. Shares of apple ( AAPL ) dipped back below its 200-day moving average.

Shares today move outside the Dow Jones

MercadoLibre (MELI) arose as much as 20% after earnings. The leaderboard inventory has been extended from an entry of 1,095.44. The Latin American e-commerce company is today’s IBD Stock Of The Day.

Shares of Block (SQ) rose 4% on strong volume after fourth-quarter earnings showed strong profits from CashApp.

Boeing (BA) plunged 5%, piercing its 50-day moving average. The airline suspended its 787 Dreamliner deliveries due to fuselage concerns raised by the Federal Aviation Administration. Production of the long-haul aircraft had previously been suspended from May 2021 to August 2022.

Legendary investor Warren Buffett’s annual letter to investors will be released on Saturday along with his fourth-quarter earnings call for Berkshire Hathaway (BRKB).

Berkshire Hathaway was a net seller in the fourth quarter as interest rates began to climb, and the firm sold much of its holdings in Taiwan Semiconductor (TSM) and US Bancorp (USB). BRKB is in a long handle cup with 321.42 entry.

Morgan Stanley analyst Joseph Moore upgraded Intel (INTC) to equal weight from underweight after chipbellwether cut its dividend by 66% earlier this week. Morgan Stanley’s price target of 28 marks an upside of 15% from today’s prices. Intel shares fell on Friday despite the upgrade, and the stock remains depressed.

Software stock earnings on deck

Some software executives report earnings next week.

Workday (WDAY) reports Monday, with Snowflake (SNOW) and DoubleVerify (DV) Wednesday. Dow Jones leader Salesforce also arrives on Wednesday. WDAY formed a cup base with an entry at 184.60 and may work with a handle. SNOW tests its 50-day line as DV cuts a handle to a cup with a 28.99 entry.

Please follow VRakrishnan on Twitter for more news on the stock market today.

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