Stocks turned positive in midday trading Friday afternoon as investors digested a final slate of corporate earnings and fresh economic data to close out the week.
All three major averages are on pace to close the week lower.
The S&P Global’s flash reading on the U.S. Manufacturing Price Index came in hotter than economists surveyed by Bloomberg had expected on Friday. U.S. Services PMI hit a 12-month high at 53.7, while U.S. Manufacturing PMI hit a six-month high of 50.4. Economists had estimated U.S. Services PMI at. 51.5 and Manufacturing PMI at 49, per Bloomberg consensus data.
The report challenges the narrative that storm clouds are brewing in the US economy.
“Output rose at the sharpest pace for almost a year, as stronger demand conditions, improving supply and a steeper uptick in new orders supported the expansion,” S&P Global wrote in the release. “Solid growth in activity was seen across both the manufacturing and service sectors.”
The earnings onslaught slowed slightly on Friday morning, with consumer staple Procter & Gamble (PG) reporting. Shares of Procter & Gamble rose more than 3% as the company raised its forecast for 2023 organic sales growth to 6%, up from a prior guidance of 4% to 5%.
P&G chairman and CEO Jon Moeller told Yahoo Finance his company isn’t seeing any signs of a recession based on consumer habits.
“We’re seeing if anything, more careful usage of the product that they have bought,” Moeller said. “So they might use a half a sheet of Bounty paper towel as opposed to a whole sheet.”
Elsewhere in earnings, mining company Freeport-McMoran (FCX) fell as much as 5%, its worst intraday performance in over a month, as copper production declined for the quarter. Shares of SAP (SAP) popped nearly 6% as the company topped estimates for revenue and earnings per share while teasing out ChatGPT integration.
“We’re getting a lot of mixed indications form the various companies reporting, even ones within the same industry,” Thomas Martin, GLOBALT Investments Senior Portfolio Manager told Yahoo Finance Live (video above). “I’m afraid we’ll have to wait for another quarter or two before we really get definitive information one way or the other.”
Stocks closed lower on Thursday amid weaker-than-expected quarterly profit at Tesla (TSLA), mixed earnings data from various sectors, and softer-than-expected housing and jobs data.
Cleveland Fed President Loretta Mester told Yahoo Finance on Thursday that interest rates need to rise above 5% given stubborn inflation. The comments came two days before Federal Reserve participants enter their blackout period prior to the next FOMC meeting on May 2.
Markets are currently pricing in a 84% chance of 25-basis-point rate hike at the next FOMC meeting, according to data from the CME group.
Josh is a reporter for Yahoo Finance. Click here for the latest stock market news and in-depth analysis, including events that move stocks