Stocks slip after Dow hits record, but head for winning week: Live updates

Stocks fell Friday to cap a big rally for the week that came in the wake of the first major easing of interest rate policy by the Federal Reserve since the pandemic.

The Dow Jones Industrial Average slipped 61 points, or 0.2%. The S&P 500 and the Nasdaq Composite pulled back 0.4% each. On Thursday, the Dow Jones Industrial average hit a record above 42,000 and the S&P 500 climbed above 5,700 for the first time.

The three major averages are on pace for weekly gains. The S&P 500 is up 1.2%, on pace for its fifth positive week over the last six weeks, and year-to-date gains over 19%. The Dow and the tech-heavy Nasdaq are up 1.4% each.

On Wednesday afternoon, the Federal Reserve slashed interest rates by a super-sized half-point, its first cut since 2020. In a delayed reaction, the market climbed higher on Thursday as investors crowded into tech names like Nvidia and shares set to benefit from lower rates like Home Depot.

Fed Governor Christopher Waller, in the first comments by a member of the Fed since Powell’s press conference, said to CNBC Friday that inflation is coming down faster than he expected, causing him to be in favor of the half-point cut.

“Investors viewed the aggressive rate cut as positive catalyst,” said Nationwide chief of investment research Mark Hackett.

“The Fed was able to effectively convince investors that the sizable cut is a proactive measure to sustain economic momentum, rather than a reactive move to stabilize it. The strong market reaction indicates investors have confidence in the Fed and have a ‘glass half full’ mentality,” Hackett added.

FedEx dented sentiment a bit on Friday after the shipping behemoth cut its earnings outlook. Shares dropped nearly 11% and competitor UPS shed more than 3% in sympathy.