US stocks were little changed on Friday afternoon with Wall Street pausing towards bullish milestones as investors hesitated about the prospects of an interest rate cut.
The Dow Jones Industrial Average (^DJI) held steady after touching the key 40,000 level for the first time during Thursday’s trading. The S&P 500 (^GSPC) moved just above the flat line, while the tech-heavy Nasdaq Composite (^IXIC) fell just below it, but all metrics were on track for weekly gains.
Stocks rose sharply following comments from Federal Reserve officials who warned that interest rates are likely to remain at historic highs for a while. This dampened enthusiasm for the prospect of interest rate cuts in September, which had been lifted by encouraging inflation data.
Read more: How does the labor market affect inflation?
Friday’s light economic and corporate docket leaves just a few jumping-off points for the Dow Jones to make another attempt at crossing the major juncture, while the S&P 500 and Nasdaq have new records within reach.
This highlights the appearances of Fed officials. US Federal Reserve Governor Michelle Bowman on Friday reiterated her view that the central bank has made no progress this year in curbing inflation, US Federal Reserve Governor Michelle Bowman said in a speech in Nashville, Tennessee. Bowman said she is willing to raise interest rates again at a future meeting if incoming data shows a further slowdown.
Federal Reserve Chairman Jerome Powell was scheduled to deliver his remarks at Georgetown University Law School’s graduation ceremony on Sunday, but will now speak via a pre-recorded video, after testing positive for the coronavirus, a central bank spokesman said on Friday.
In individual moves, shares of Reddit (RDDT) jumped 13%, not far from its highest close of $65.11 in March. The social media platform has signed a partnership with OpenAI which will see ChatGPT integrate content from its forums.
Meanwhile, shares of GameStop (GME) fell more than 25% after the gaming retailer said it expects first-quarter sales to decline as shoppers turn to online outlets. Shares in meme stocks soared at the start of the week in an echo of 2021’s madness, but the rise has turned into a decline in recent days.
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Federal Reserve Chairman Jay Powell has tested positive for COVID-19
A central bank spokesperson revealed on Friday that Federal Reserve Chairman Jerome Powell has tested positive for COVID-19.
The spokesman said Powell received the diagnosis on Friday, saying he tested positive “late yesterday” and is experiencing symptoms.
The Fed indicated that Powell will no longer attend Georgetown Law School’s graduation ceremony, where he was scheduled to deliver his remarks in person on Sunday. Instead he will do so via a pre-recorded video.
“Following Centers for Disease Control and Prevention guidelines, he is staying away from others and working at home,” the Fed said in a statement. Powell has tested positive for the virus before, in 2023.
Federal Reserve Chairman Jerome Powell departs after the conclusion of the Treasury Department’s Financial Stability Oversight Board meeting on May 10, 2024 in Washington, DC. (Photo by Kent Nishimura/Getty Images) (Kent Nishimura via Getty Images) -
GameStop stock fell during the move to issue stock
The mini meme stock rally of 2024 is running out of steam
GameStop (GME) stock fell as much as 30% on Friday after the company filed to sell 45 million new shares of common stock and Preliminary financial results were released Which showed a sharp decline in sales compared to the same period last year, Yahoo Finance’s Josh Schaeffer reports.
The video game retailer said it expects sales to range between $872 million and $892 million in the fiscal first quarter, down from $1.24 billion in the same period a year earlier. Wall Street was expecting revenue of just over $1 billion for the quarter, according to data from Bloomberg.
With Friday’s decline, the stock is now lower than where it opened Monday morning after Keith Gill, also known as “Roaring Kitty,” on X, formerly Twitter, resurfaced over the weekend. Gill’s bullish case for GameStop ignited the meme’s stock rally again in 2021, and the stock had more than doubled by Tuesday morning.
“I don’t see anything in the pre-announcement that tells me the business is starting to turn around,” Wedbush managing director Michael Butcher told Yahoo Finance. “But at least they’ll make enough money to last another three or four years if they actually keep failing and try to find a new strategy.”
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Reddit stock emerges from pre-market on OpenAI deal
Reddit stock (RDDT) rose 14% pre-market under a new deal with OpenAI where OpenAI will have access to Reddit data to help build its models.
This deal should come as no surprise to Reddit investors, as the company recently struck a similar deal with Alphabet (GOOGL). Steve Huffman, co-founder and CEO of Reddit, told me last week that more deals like this are likely to be part of the platform’s reinvention.
Look for a new UI later this year.
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