US stocks moved higher on Friday as investors responded to inflation data that matched forecasts and watched for planned talks between the United States and Iran over the weekend. The S&P 500 stayed on track for its strongest week since May, while oil remained near $98 a barrel after recent war-driven gains.

Consumer prices rose sharply in March, mainly because gasoline and diesel costs jumped during the conflict. However, core inflation stayed more contained, which helped calm markets. Investors also kept watching the Strait of Hormuz, where shipping risks remain central to the outlook for oil, inflation, and global risk appetite.

CPI Data Supports Stocks as Headline Inflation Rises

The latest Consumer Price Index report showed a 0.9% monthly rise in March, the biggest increase since June 2022. On an annual basis, CPI rose 3.3%, up from 2.4% in February. A 21.2% jump in gasoline prices drove much of the increase, while other motor fuels, including diesel, rose 30.8%.

Even so, core CPI, which excludes food and energy, rose 0.2% on the month and 2.6% from a year earlier. Markets took some relief from the softer core reading because it suggested the first inflation shock had not yet spread broadly across the economy.

Brian Jacobsen at Annex Wealth Management said, “There are no signs, yet, that high energy prices are seeping into core inflation.” Bret Kenwell at eToro also said, “The message is clear: inflation remains sticky.” Both comments reflected a market view that inflation pressure remains real, yet not severe enough at this stage to force an immediate policy shift.

US-Iran Talks Remain Central to Market Direction

Investors also followed diplomatic moves ahead of Saturday’s planned meeting in Pakistan between the US and Iranian delegations. Markets have stayed sensitive to every update because the conflict pushed oil sharply higher and raised fears over shipping through the Strait of Hormuz.

President Donald Trump said he remained “optimistic” about the outlook, although he also warned Tehran against taking actions that could disrupt traffic through the strait. Traders treated the ceasefire as fragile, yet they also saw room for more stability if talks continue.

Tom Essaye of Sevens Report wrote, “As long as the face-to-face meeting Saturday morning isn’t cancelled, geopolitics shouldn’t weigh on markets too much.” Still, economists warned that one or two more strong inflation readings may follow if energy costs stay elevated in the near term.

Fed Outlook Stays Steady as Yields Edge Higher

Treasury yields moved higher after the inflation report, but rate expectations did not shift sharply. The 10-year Treasury yield rose three basis points to 4.30%, showing that bond investors still expect inflation pressure to remain present for some time.

Recent data has also made the Federal Reserve’s job more difficult. Strong job growth, firm consumer prices, and energy-driven uncertainty have supported the view that policymakers may stay on hold for several meetings. Some economists now see little chance of a rate cut this year unless labor market conditions weaken.

Consumer sentiment added another layer of caution. Separate data showed US consumer sentiment fell to a record low in recent weeks as households worried more about rising prices and the economic cost of the war.

Market Moves and Leadership Trends

The S&P 500 rose 0.2% by late morning in New York, while the NASDAQ 100 gained 0.4%. The Dow Jones Industrial Average fell 0.3%. In Europe, the Stoxx Europe 600 rose 0.5%, and the MSCI World Index added 0.3%.

In other markets, Bitcoin rose 0.6% to $72,870.70, and Ether gained 1.3% to $2,242.39. West Texas Intermediate crude climbed 0.7% to $98.52 a barrel, while spot gold rose 0.3% to $4,778.98 an ounce.

Under the surface, leadership has also shifted. Strategists said value stocks have outperformed growth shares by a wide margin in recent months, while some retail traders have turned more defensive as war-related volatility and higher energy prices continue to affect sentiment.

Corporate Highlights

• Treasury Secretary Scott Bessent and Fed Chair Jerome Powell called Wall Street leaders to an urgent meeting over cyber risk linked to Anthropic’s latest AI model.

• Anthropic agreed to rent data center capacity from CoreWeave to support rising AI demand.

• CoreWeave shares rose after the Anthropic agreement drew investor attention.

• Ares Management plans a smaller flagship US direct lending fund than its previous $33.6 billion vehicle.

• Berkshire Hathaway sold ¥272.3 billion, or about $1.7 billion, in yen-denominated bonds.

• Taiwan Semiconductor Manufacturing reported a 35% rise in quarterly revenue.

• Lumentum said demand from major US technology companies for optical components is rising and may fill order books through 2028. 

Despite rising prices for energy, markets remain positive because softer core inflation is boosting their morale. Attention will now shift to negotiations between the US and Iran and how these will influence the oil market and the situation around the world. Further movement in the markets will depend on these negotiations.

Also Read: US Stock Market Today: S&P 500, NASDAQ Drop as Trump’s Iran Deadline Lifts Oil and Treasury Yields