NEW YORK, Dec 15 (Reuters) - U.S. stocks were mixed while the dollar rebounded and Treasury yields steadied near multi-month lows on Friday as market participants caught their breath near the end of a week loaded with central bank policy decisions and crucial economic data.
Euphoria over the U.S. Federal Reserve's dovish pivot was dampened a bit after New York Federal Reserve President John Williams pushed back against rate cut expectations, reiterating that the central bank remains focused on bringing inflation down to its 2% target.
Having oscillated for much of the session, the S&P 500 and the blue-chip Dow were last modestly lower, while interest rate-sensitive tech- and tech-adjacent momentum stocks buoyed the Nasdaq into positive territory.
"We’ve been hovering around the flatline all day today," said Bill Northey, senior investment director at U.S. Bank Wealth Management in Helena, Montana. "After moving through some critical macroeconomic data points, including the Fed meeting, the market is digesting the news."
All three indexes are on course to register their seventh consecutive weekly gains, which would mark the S&P 500's longest streak of weekly gains since September 2017.
"It’s important to step back to early November when we saw the October price index print," Northey said. "Since that time we’ve seen real evidence of a decelerating inflation trend, which has allowed the Fed to pivot and reconcile with views that were already reflected in the market."
"Our expectation is that trends in place over the past six weeks are likely to follow through to year end albeit at a somewhat slower pace," Northey added.
Economic data released on Friday signaled an uptick in U.S. business activity but also showed the manufacturing sector continues to struggle.
The Dow Jones Industrial Average fell 44.91 points, or 0.12%, to 37,203.44, the S&P 500 lost 7.95 points, or 0.17%, to 4,711.6 and the Nasdaq Composite added 33.19 points, or 0.22%, to 14,794.75.
European shares ended nearly flat to cap a week of rising rate cut expectations, posting their fifth consecutive weekly gain.
The pan-European STOXX 600 index inched up 0.01% but MSCI's gauge of stocks across the globe shed 0.16%.
Emerging market stocks rose 0.70%. MSCI's broadest index of Asia-Pacific shares outside Japan closed 1.02% higher, while Japan's Nikkei rose 0.87%.
U.S. Treasury yields were little changed after the Fed's Williams reined in the rate cut fervor.
Benchmark 10-year notes fell 1/32 in price to yield 3.9315%, from 3.93% late on Thursday.
The 30-year bond rose 14/32 in price to yield 4.0313%, from 4.054% late on Thursday.
The dollar rebounded against a basket of world currencies. But the index remained on course for its biggest weekly drop in a month after the Fed's dovish pivot. In contrast, the Fed's European counterparts maintained a tougher stance, which had boosted the euro and the pound on Thursday.
The dollar index rose 0.63%, with the euro down 0.89% to $1.0893 on Friday.
The Japanese yen weakened 0.27% to 142.26 per dollar, while sterling was last trading at $1.2684, down 0.64% on the day.
Oil prices eased back from the previous session's sharp gains with U.S. crude settling 0.21% lower at $71.43 per barrel, while Brent settled at $76.55 per barrel, down 0.08% on the day.
Gold dropped 0.9% to $2,017.29 an ounce but remained on track for a weekly gain.
(Reporting by Stella Qiu; Editing by Chizu Nomiyama, Kirsten Donovan)
