US stock markets closed lower on Friday amid weakening consumer confidence data. The Dow Jones Industrial Average fell 0.26% to 53,701.92, dropping more than 100 points from the prior session. The NASDAQ Composite declined 0.51% to 26,665.88, while the S&P 500 slipped 0.24% to 7,780.42.

The decline followed disappointing economic indicators, including a drop in July retail sales and a significant miss in consumer sentiment estimates.

Economic Data Misses Estimates

Key macroeconomic releases highlighted softening demand in the US economy. U.S. retail sales declined 0.6% month-over-month in July, reversing a 0.2% gain recorded in June. This figure missed market estimates of a 0.1% rise.

Simultaneously, the University of Michigan’s consumer sentiment index fell to 51 in early August. This represents a decline from 55.2 in the previous month and missed analyst expectations of 54.5.

Sector Performance

Market breadth was mixed, with energy shares outperforming while technology lagged. Energy stocks rose by 1.3%, supported by higher commodity prices. In contrast, information technology shares fell by 0.6%.

Top Movers

Individual equity movements were driven by earnings reports and corporate actions.

Gainers:

• Eton Pharmaceuticals Inc (NASDAQ: ETON) surged 39% to $56.68 after reporting better-than-expected quarterly results and issuing FY26 revenue guidance above estimates.
• Valneva SE (NASDAQ: VALN) jumped 25% to $7.04 following validation of its Marketing Authorization Application for PF-07307405 by the European Medicines Agency.
• MDxHealth SA (NASDAQ: MDXH) rose 80% to $0.83 after beating second-quarter sales expectations and affirming FY26 guidance above estimates.

Losers:

• Innventure Inc (NASDAQ: INV) dropped 49% to $1.84 on mixed quarterly financial results.
• KinderCare Learning Companies Inc (NYSE: KLC) fell 31% to $3.35 after missing second-quarter expectations and cutting FY26 guidance below estimates.
• Microvision Inc (NASDAQ: MVIS) declined 46% to $2.02 following an announcement of a $17 million offering of 6.8 million units at $2.50 per unit.

Commodities and Global Markets

Commodity prices edged higher across major assets. Oil rose 0.4% to $81.55. Gold gained 0.7% to trade at $4,450.60. Silver increased 0.3% to $65.21, while copper rose 0.1% to $6.6095.

European markets were mostly lower. The STOXX 600 fell 0.2%, London’s FTSE 100 dropped 0.2%, and France’s CAC 40 slipped 0.2%. Spain’s IBEX 35 declined 0.1%. Germany’s DAX was the exception, gaining 0.5%.

Asian markets closed mixed on Friday. Japan’s Nikkei 225 rose 0.59%, while China’s Shanghai Composite increased marginally by 0.01%. Hong Kong’s Hang Seng index fell 1.10%, and India’s BSE Sensex declined 0.09%.

US stock markets closed higher on Thursday, with the S&P 500 reaching a new record high of 7,798.99, up 0.65%. The Dow Jones Industrial Average rose approximately 70 points to close at 53,839.99, while the NASDAQ Composite climbed 0.81% to 26,803.03. The positive market movement was driven by macroeconomic data indicating cooling inflation pressures and improving investor sentiment.

Macroeconomic Data

The market rally aligned with the release of the July Producer Price Index (PPI) data. Headline producer prices remained flat for the month, missing the anticipated 0.2% monthly rebound. Core PPI also undershot expectations, echoing Wednesday’s cooler consumer inflation report that showed the annual rate easing to 3.4%. On an annual basis, producer inflation had previously eased to 4.7%, down from 5.5%.

Labor market data showed signs of softening, with US initial jobless claims rising by 9,000 to 209,000 in the week ended August 8, exceeding market estimates of 202,000.

Investor sentiment improved alongside the economic data. The CNN Money Fear and Greed Index rose to 66 from a prior reading of 63, remaining firmly in the 'Greed' zone. The index, which ranges from 0 (maximum fear) to 100 (maximum greed), is calculated based on seven equal-weighted indicators.

Sector Performance

Most sectors within the S&P 500 closed positively. Information technology, real estate, and communication services stocks recorded the biggest gains during the session. Conversely, energy and materials stocks bucked the broader market trend, closing lower.

Top Movers

Several equities saw significant volatility based on corporate announcements and earnings results:

• SanDisk Corp (NASDAQ: SNDK) soared around 14% after unveiling a new optimistic roadmap during its investor day.
• XChange TEC Inc (NASDAQ: XHG) surged 554% to $5.98 after announcing its intent to acquire First Cycle Inc.
• DEFSEC Technologies Inc (NASDAQ: DFSC) rose 108% to $2.58 following third-quarter financial results.
• FGI Industries Ltd (NASDAQ: FGI) gained 55% to $7.50 after reporting better-than-expected second-quarter adjusted EPS and issuing FY26 sales guidance with a midpoint above estimates.

On the downside:

• Cisco Systems Inc (NASDAQ: CSCO) fell over 8% after reporting fourth-quarter fiscal 2026 financial results.
• Leslie’s Inc (NASDAQ: LESL) fell 38% to $0.82 after reporting worse-than-expected third-quarter results and withdrawing FY26 guidance.
• Cellebrite DI Ltd (NASDAQ: CLBT) dropped 35% to $9.95 following weak second-quarter sales results and subdued third-quarter guidance.
• Founder Group Ltd (NASDAQ: FGL) declined 37% to $0.49.

Global Markets and Commodities

European markets showed mixed performance. The eurozone’s STOXX 600 gained 0.1%, while Spain’s IBEX 35 rose 0.5%. In contrast, London’s FTSE 100 fell 0.4%, Germany’s DAX gained 0.2%, and France’s CAC 40 dipped 0.1%.

Asian markets also closed mixed. Japan’s Nikkei 225 rose 1.16%, and India’s BSE Sensex increased 0.15%. However, Hong Kong’s Hang Seng index fell 0.17%, and China’s Shanghai Composite declined 0.50%.

In commodities, oil prices dropped 2.6% to $81.12. Precious metals faced headwinds, with gold falling 0.6% to $4,441.40 and silver down 0.6% to $65.315. Copper was the only gainer among major metals, rising 0.1% to $6.6160.

What the Numbers Show

The combination of flat headline producer prices and rising jobless claims reinforces the narrative of disinflationary pressure in the US economy. While the S&P 500 hit a record high, the divergence between tech-led gains and declines in energy and materials suggests sector rotation driven by lower inflation expectations rather than broad-based economic acceleration. The move of the Fear and Greed Index into the 'Greed' zone indicates that investors are increasingly willing to take risks despite the mixed signals from labor market data.