Consumer confidence fell in September even though consumer prices remained mostly flat in August, and that mixed data released Friday left stocks range-bound in typically lackluster trading for a summer Friday.
By the end of the trading day, stocks edged slightly higher, with the Dow Industrials ending up 13.02, or 0.12%, to close at 10,607.85. The Dow rose 1.39% for the week. The S&P 500 index gained 0.93, or 0.08%, to close at 1,125.59. The Nasdaq Composite, however, gained 12.36 on Friday, or 0.54%, to close at 2,315.61; the Nasdaq was up 3.26% for the week.
Disappointing economists' expectations, the Thomson Reuters-University of Michigan consumer sentiment surveyworsened in early September to its weakest level in more than a year, as job and finance worries intensified. The overall index's preliminary September reading was posted at 66.6, down from 68.9 in August.
Economists had expected the index would rise to 70.
In other consumer news, the U.S. Labor Department reported that the consumer price index (CPI)rose 0.3% in August, unchanged from July. Excluding the volatile energy and food component, the core index was flat in August--renewing concern that the U.S. economy is headed down a deflationary path. The core index rose 0.1% in July and 0.2% in June. Core inflation has stood at 0.9% for five consecutive months, its lowest level in more than 50 years.
The CPI data didn't surprise economists, who had called for a 0.3% increase in August, with the core index 0.1% higher.
Energy costs pushed August's price indexes up, according to Pittsburgh-based PNC Financial Services Group, led by Chief Economist Stuart Hoffman. The group noted in a statement that price indexes at both the consumer and producer levels were nudged higher as energy prices increased on a seasonally adjusted basis.
The producer price index (PPI) rose 0.4% in August after a 0.2% increase in July, its first increase in three months, the Labor Department reported Thursday.
"Outside of energy there was little downstream inflationary pressure visible in August and core prices remained well contained. Looking upstream we do see some gains in crude agricultural goods but this will not be enough to unhinge inflation expectations at the consumer level," the PNC Financial Services Group said.