SPDR S&P 500 ETF Edges Up 0.07% as US Inflation Drops to 2.4%
Annual US inflation slowed to 2.4% in January from 2.7% in December, the lowest reading since May 2025, driven by a 3.2% drop in gasoline prices and a 6.5% surge in airline fares. SPDR S&P 500 ETF posted a 0.07% gain while Nasdaq-focused QQQ fell 0.21%.
1. Inflation Slowdown
US annual inflation slowed to 2.4% in January from 2.7% in December, marking the lowest reading since May 2025. Energy costs led the decline with a 3.2% drop in gasoline prices, while airline fares and shelter costs climbed 6.5% and 0.2%, respectively.
2. SPY and Broad Market Performance
SPDR S&P 500 ETF posted a 0.07% gain on Friday, offsetting a 0.33% year-to-date drop in the S&P 500 index. The Dow Jones Industrial Average, by contrast, is up 2.31% so far this year, highlighting a split among leading benchmarks.
3. Tech Sector Weakness
The Nasdaq Composite has fallen 2.97% in 2026, with the QQQ ETF down 0.21% on the latest session. Key technology names lagged behind, dragging overall market momentum despite resistance in blue-chip stocks.
4. Implications for Investors
The deceleration in inflation may ease concerns about further interest rate hikes, potentially supporting equity valuations. However, rising costs in transportation and housing could tense consumer spending and corporate profit margins.