The US markets closed mostly higher on Friday, after trimming gains in the last few minutes of the session. However, steep losses in technology and health-care stocks earlier in the week resulted in poor weekly and mixed monthly performances for all three benchmarks. Still, the main benchmarks posted solid quarterly gains, while the S&P 500 index and Nasdaq Composite ended their first half of the year with the largest gains in several years. Though the month of July will get off to a slow start with Wall Street only open a half day on Monday and closed on Tuesday for the Fourth of July holiday, the pace for markets will quickly pick up as they turn their attention to key events scheduled for the entire month with a particularly close eye on the Federal Reserve. Wednesday will get the ball rolling with the publication of the minutes from the last meeting of the Federal Open Market Committee (FOMC).
On the economy front, a regional index of business conditions in the Chicago area rose in June to the highest level in more than three years, suggesting steady growth in the US economy. The Chicago Business Barometer rose to 65.7 in June from 59.4 in May. That’s the highest level since May 2014. New orders climbed to the highest level in three years and backlogs for orders reached a 23-year high, potentially reflecting large bookings for Boeing jets. An employment gauge fell slightly but still remained quite healthy. Companies were worried about a scarcity of skilled workers, an increasingly frequent complaint.
Separately, Americans barely increased spending in May and choose to save more money instead even as decelerating inflation gave them more bang for the buck. Consumer spending rose 0.1% last month after back-to-back 0.4% gains in April and March. The meager increase in spending took place against a backdrop of slowing inflation. The PCE index, the Federal Reserve’s preferred inflation gauge, fell 0.1% to mark the second decline in three months.
The Dow Jones Industrial Average added 62.6 points or 0.29 percent to 21,349.63, S&P 500 edged higher by 3.71 points or 0.15 percent to 2,423.41, while Nasdaq dropped 3.93 points or 0.06 percent to 6,140.42.