US Stocks Drift Around Record Heights Amid Weaker Economic Data

US stocks drifted around their record heights after Friday's report on economic data came in weaker than expected. The S&P 500 was virtually unchanged, while the Dow Jones Industrial Average dropped by less than 0.1%, and the Nasdaq composite fell 0.2%. Treasury yields were mixed in the bond market following a surprise decline in US retail sales.

The report on consumer spending could keep interest rates low, which is good news for Wall Street, but it also raises concerns about slow growth and high inflation, known as stagflation. The Federal Reserve has no effective tool to fix both a stagnant economy and high inflation at the same time.

Some market analysts cautioned against overreacting to the weak data on US retail sales, suggesting that it might be a snap back after unusual factors boosted sales in earlier months. However, consumer sentiment is weakening, particularly among older, lower-income groups who can be hurt most by inflation.