US Stocks Retreat as Inflation Data Dampens Market Sentiment

Wall Street closed lower on Friday as investors digested fresh inflation data that showed prices firming above the Federal Reserve's target. The Dow Jones Industrial Average dipped 0.2%, while the S&P 500 fell 0.6%. The Nasdaq Composite led losses, dropping 1.1% as Big Tech stocks stumbled—Nvidia slid 3% post-earnings.

Despite the pullback, August marked the fourth consecutive winning month for the S&P 500 and Dow, which gained 1.4% and 2% respectively. The Nasdaq extended its streak to five months with a 1.6% advance.

The Core PCE index—the Fed's preferred inflation gauge—rose 0.3% monthly and 2.9% annually, matching expectations but reinforcing concerns about persistent price pressures. Consumer sentiment worsened to a three-month low amid inflation fears, according to the University of Michigan survey.