S&P 500 posts worst week of 2023 with 2.7% loss

By Ovunc Kutlu

ISTANBUL (AA) - The S&P 500 posted its worst week of 2023 as US stocks closed lower Friday after the Federal Reserve's preferred inflation indicator disappointed investors.

The index lost 42 points, or 1.05%, to finish the last trading day of the week at 3,970 points as it had a weekly loss of 2.7%. It was the worst week for the index since Dec. 9.

The Dow Jones fell almost 337 points, or 1.02%, to end the session at 33,816. This was the fourth consecutive weekly loss for the blue-chip index, which fell 3% for the week.

The Nasdaq plummeted 195 points, or 1.69%, to end the last trading day of the week at 11,394. The tech-heavy index had a weekly decline of 3.3%.

The core personal consumption expenditures price index, the Fed's preferred inflation indicator, rose 4.7% annually in January, up from a 4.6% year-on-year gain in December, and was higher than estimates of a 4.3% increase. The index rose 0.6%, up from a 0.4% monthly gain in December and higher than expectations of a 0.4% increase.

Figures that were higher than estimates and gaining annually and monthly raised fears among investors that the US central bank is likely to continue interest rate hikes for at least the first half of 2023, which will further decrease the amount of liquidity in the markets.

The VIX volatility index, also known as the fear index, was up 2.5% at 21.67, while the 10-year US Treasury yield rose 1.7% to 3.947%.

The dollar index added 0.6% to 105.24, while the euro shed 0.44% to $1.0548 against the greenback.

Precious metals were in negative territory, with gold losing 0.6% to $1,811 per ounce and silver diving 2.6% to $20.76.

Oil prices were up around 1.4%, with global benchmark Brent crude at $83.32 per barrel and US benchmark West Texas Intermediate at $76.54.