US stocks end the week higher after cool inflation and Apple AI hype

• U.S. stocks traded mostly lower on Friday, but ended the week on the heels of a cool May CPI report.

• The Nasdaq 100 closed at record highs, driven by AI excitement and solid earnings from Broadcom and Adobe.

• Recent comments from the Fed indicate that rate cuts are imminent if inflation rates continue to cool.

U.S. stocks traded mostly lower on Friday but rose this week after a chilly inflation report in May and Apple’s unveiling of its AI ambitions at WWDC.

The S&P 500 hit record highs for four days in a row through Thursday, while the Nasdaq 100 closed at record highs every day of the week, with AI excitement driving tech stocks higher after Broadcom’s huge profit rise and Adobe’s solid results.

The Nasdaq 100 ended the week more than 3% higher, while the S&P 500 rose about 1.5%. The Dow Jones, which has little exposure to AI technology trading, ended the week down about 0.5%.

Comments from outgoing Federal Reserve President Loretta Mester on Friday made it clear that the Fed is poised to cut rates after a series of chilly inflation data.

Both the consumer price index and the producer price index rose less than expected in May, with the PPI being the lowest in ten months.

“It is welcome to see inflation coming back down, but we need to see that continue a little longer,” Mester told CNBC on Friday.

Fed President Austan Goolsbee said Friday that he, too, was encouraged by the May CPI report.

“We’ve actually made a lot of progress in lowering inflation. We just need to see more progress” before cutting rates, Goolsbee said.

According to the CME FedWatch Tool, the market currently sees a 61% chance that the Fed will cut rates at the September FOMC meeting.

Here’s where the US indexes stood at 4pm on Friday:

Here’s what else happened today:

In commodities, bonds and crypto:

• West Texas Intermediate crude fell 0.09% to $78.55 a barrel. Brent crude, the international benchmark, fell 0.08% to $82.68 per barrel.

• Gold rose 1.39% to $2,350.30 an ounce.

• The yield on ten-year government bonds fell by three basis points to 4.21%.

• Bitcoin fell 1.99% to $65,417.

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