The Standard & Poor's 500 index shed 1% this week amid worries about competition in the technology sector and the Trump administration's tariff plans, but the market benchmark still ended January with a monthly gain.
The S&P 500 closed Friday's session at 6,040.53. While this marks a decline from a week ago, the index is still near its record high of 6,128.18 reached last Friday. It is also up 2.7% from the end of 2024 and up 25% from a year ago.
The market received quarterly earnings reports from a number of companies this week, with many surpassing analysts' mean estimates, including Apple (AAPL) and Visa (V).
Also, the Federal Reserve's preferred inflation measure, the personal consumption expenditures price index, met expectations with a 0.3% increase for December. On Wednesday, the central bank's Federal Open Market Committee maintained the range of its policy rate at 4.25% to 4.50%, as expected, but made changes to its statement that showed inflation remains elevated while removing an acknowledgment of progress.
Nevertheless, investors are nervous about how inflation may be impacted by the Trump administration's planned tariffs. On Friday, White House Press Secretary Karoline Leavitt said President Donald Trump will begin implementing a 25% tariff on Mexico and Canada and a 10% tariff on China on Saturday.
Worries also ramped up over how well the US technology sector will be able to compete in the artificial intelligence space amid the entry of a new AI model from DeepSeek, a Chinese startup company, that generated a lot of chatter.
The technology sector had the largest percentage drop in the S&P 500 this week, falling 4.6%, followed by a 3.8% decline in energy and a 2.1% loss in utilities. Industrials, real estate, and materials also posted weekly declines.
NVIDIA (NVDA) was hit the hardest in the technology sector, falling 16% on the week amid investors' worries over competition from DeepSeek.
In the energy sector, shares of ONEOK (OKE) fell 7% as the company said it completed its acquisition of EnLink Midstream.
However, on the upside, communication services rose 2.7%, followed by a 1.9% advance in consumer staples and a 1.7% increase in health care. Financials and consumer discretionary also edged higher.
T-Mobile US (TMUS) had the largest percentage gain in communication services, climbing 6.6% on the week on better-than-expected fourth-quarter results aided by postpaid phone subscriber additions that came in ahead of Wall Street's projections.
Meta Platforms (META) shares also gave a big boost to communication services, rising 6.4% as the Facebook parent reported Q4 earnings and revenue above year-earlier results and analysts' mean estimates.
Gainers in consumer staples included shares of Kroger (KR), up 5%, and Costco Wholesale (COST), up 4.3%.
In health care, AbbVie (ABBV) shares jumped 8%. The company reported better-than-expected fourth-quarter results amid robust sales of its Skyrizi and Rinvoq drugs, prompting the drugmaker to lift its long-term combined revenue outlook for the two immunology drugs.
Next week's earnings calendar includes Google parent Alphabet (GOOGL, GOOG), Merck (MRK), Pepsico (PEP), Advanced Micro Devices (AMD), Amgen (AMGN), Pfizer (PFE), Walt Disney (DIS), Qualcomm (QCOM), Amazon.com (AMZN), Eli Lilly (LLY) and Philip Morris International (PM).
Economic data will feature January employment numbers, with ADP's private sector employment report on Wednesday and the government's nonfarm payrolls and unemployment rate due Friday. Other data on next week's calendar will include January automotive sales, December factory orders and wholesale inventories, and January consumer sentiment.
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