The Dow Jones Industrial Average finished Friday's session with modest gains, adding 48.95 points to close at 49,500.93. The move higher was supported by a January Consumer Price Index report that showed inflation cooling slightly more than economists had forecast. Despite the positive finish, the blue-chip index declined 1.2% for the week, retreating from record highs set earlier in the period.
Technology shares faced continued pressure, dragging the Nasdaq Composite to its fifth consecutive weekly decline. The sector's struggles began earlier in the week after a robust January jobs report prompted investors to recalibrate expectations for the timing and pace of potential Federal Reserve interest rate cuts.
The key inflation data revealed consumer prices rose 2.4% in January compared to the same month a year earlier, coming in just below the consensus forecast of 2.5%. Analysts noted the figure brings inflation closer to the Federal Reserve's long-term 2% target. Following the central bank's decision to hold rates steady at its late-January meeting, market participants have begun pricing in at least two rate reductions before the end of the year.
U.S. financial markets will be closed on Monday, February 16, in observance of Presidents Day. Trading activity and investor focus will resume in earnest on Tuesday, with a significant week of economic releases and corporate earnings ahead.
Central Bank Insights and Economic Gauges on Deck
The Federal Reserve will release the minutes from its January 27-28 policy meeting on Wednesday, February 18. This document will provide crucial insights into the deliberations of central bank officials and their views on the path of monetary policy. The Fed's preferred inflation gauge, the Personal Consumption Expenditures (PCE) price index, is scheduled for release on Friday, February 20.
Analysts are closely handicapping the potential market impact of the PCE report. Barclays analyst Pooja Sriram anticipates a 0.4% monthly increase for both the headline and core PCE readings for December. A result that exceeds current investor expectations could trigger volatility in bond yields and equity prices.
Also on Friday, the Bureau of Economic Analysis will publish two delayed but critical reports: the advance estimate of Gross Domestic Product for the fourth quarter and for the full year 2025, alongside December's Personal Income and Outlays data, which contains the PCE index.
Corporate Earnings and Macro Crosscurrents
The earnings calendar features several notable reports. Retail giant Walmart is scheduled to announce its fourth-quarter financial results before the market opens on Thursday, February 19. Management will host a conference call at 7 a.m. CST to discuss the figures. Later that morning, agricultural and construction equipment manufacturer Deere & Company will report its first-quarter earnings. Investors often scrutinize Deere's results for signals regarding the health of the industrial and farm economy sectors.
Beyond domestic data, a slate of international economic indicators could influence global risk sentiment. S&P Global highlighted upcoming February "flash" Purchasing Managers' Index (PMI) business surveys, as well as GDP and inflation readings from major economies, which could quickly refocus the market debate on global growth prospects versus interest rate trajectories.
Trade policy remains a persistent theme, particularly for industrial companies. The current administration has indicated it will maintain existing steel and aluminum tariffs, with officials stating any potential changes would require direct authorization from the President. Market observers are also watching for any continued rotation of investor capital from high-valuation growth stocks into more value-oriented segments of the market as the new trading week gets underway.
