Traders work on the floor of the New York Stock Exchange (NYSE) on February 13, 2026 in New York City.
Spencer Platt | Getty Images
The S&P 500 rose on Friday after a key consumer inflation report came in slightly lighter than expected, but stocks were still on pace for a losing week.
The broad market index traded up 0.5%, while the Nasdaq Composite climbed 0.4%. The Dow Jones Industrial Average added 158 points, or 0.3%.
The Bureau of Labor Statistics reported that the consumer price index — which measures the costs for goods and services in the U.S. economy — rose 0.2% in January, reflecting a gain of 2.4% on an annualized basis. The inflation gauge was expected to show a 0.3% increase on a month-over-month basis and a 2.5% advance from a year earlier, according to economists polled by Dow Jones.
When excluding volatile food and energy prices, core CPI came in line with expectations at 0.3% on the month and 2.5% year over year.
“This should be welcome news for markets, and the presumptive incoming Fed Chair Kevin Warsh,” said Phil Blancato, Osaic chief market strategist. “This is only one month’s worth of data but if the trend continues it should pave a path for lower interest rates and reined in inflation.”
Inflation is also “not unrelated” to existing fears among investors that artificial intelligence will disrupt revenue potential in various industries, according to Keith Buchanan of Globalt Investments. While Friday’s CPI print “has nothing to do with what we’re anticipating” as far as industry disruption goes, the market is still trying to figure out what AI and its implementation throughout the economy really means, he said, noting that it’s creating “upward pressure on unemployment” as well as “downward pressure on inflation.”
“How do we think that everyone was going to win and there wouldn’t be a loser?” the senior portfolio manager told CNBC.
AI disruption fears rattled the market this week, spreading beyond the recent sell-off seen in software and into notable areas such as the real estate, trucking, and financial services. Financial stocks Charles Schwab and Morgan Stanley have fallen 10% and 5% this week, respectively, while software stock Workday is down 10% in the period. Shares of commercial real estate firm CBRE have lost 16% week to date.
Those fears widened to the media industry as well, hitting media stocks such as Walt Disney and Netflix. Disney shares have declined 3% on the week, while Netflix shares have dropped 6%.
“Investors show no mercy for anything seen as an AI loser. The list is growing by the day, driving divergence between new/old economy sectors and U.S./[Rest Of World] equities,” said Barclays analyst Emmanuel Cau. “Amid erratic price action and fears of AI disruption turning into a broader macro/credit issue, growth, rates & earnings backdrop is okay.”
Though stocks moved higher Friday, the three major averages are on track for weekly losses. The S&P 500 and 30-stock Dow are both off around 1%, and the tech-heavy Nasdaq is set for a more than 1% slide in the period.
Semiconductor giant Applied Materials was a bright spot in Friday’s session, jumping 9% on the back of strong earnings results and encouraging outlook. Airbnb was also a winner, as shares rose 4% as investors cheered the rental company’s upbeat guidance. Pinterest shares, by contrast, slipped 18% after the company posted fourth-quarter results that missed expectations and issued a weak forecast.