Stock market today: US stocks edge lower after best day of the year as volatile week wraps up

• US stocks edged lower Friday after the best trading day since November 2022.
• The S&P 500 is down half a percentage point this week amid growing concerns of an economic slowdown.
• Investors are awaiting key inflation readings due next week.

US stocks edged lower on Friday, a day after stocks experienced their best trading day since November 2022.

The strongest day of gains in nearly two years came just two days after stocks experienced their worst trading day since September 2022.

For all of the volatility in markets this week, the S&P 500 is down just half a percentage point, as investors seek direction and juggle prospects of imminent interest rate cuts and the potential for an economic slowdown.

"Over the last few days, we have been reminded that risk-off moves happen quickly and can come from seemingly out of nowhere," Penn Mutual investment analyst Matt Dyer said.

The volatility was sparked by a confluence of risk factors, headlined by the unwind of the yen carry trade and concerns of a misstep by the Federal Reserve following an uptick in the unemployment rate in July.

But as stocks claw back some of the big losses incurred on Monday, the volatility has calmed down, with the stock market's fear gauge, the VIX, falling from an intraday peak of 65 on Monday to just under 24 on Thursday.

Looking ahead to next week, investors will be awaiting key inflation reports, including the Producer Price Index on Tuesday, followed by the Consumer Price Index on Wednesday.

Analysts on Wall Street say they're expecting a modestly stronger consumer inflation reading, but not hot enough to derail the outlook for the Fed to cut interest rates next month.

"We forecast headline CPI rose by 0.3% m/m in July, owing mainly to a pickup in core services inflation and energy prices. This would leave the y/y rate unchanged at 3.0%. Meanwhile, we expect core CPI increased by 0.2% m/m," Bank of America analysts wrote Friday, adding that if data comes in-line with their forecasts, markets will start pricing in fewer rate cuts.

Here's where US indexes stood shortly after the 9:30 a.m. opening bell on Friday:

• S&P 500: 5,310.83, down 0.17%
• Dow Jones Industrial Average: 39,325.47, down 0.31% (-121 points)
• Nasdaq composite: 16,650.78, down 0.06%

Here's what else is going on today:

• Legendary investor Jeremy Grantham warned that stocks are poised to crash as a recession appears inevitable.
• Here's how the stock market can predict who will win the Presidential election in November.
• There are two conflicting forces that will define how stocks perform the rest of the year.

In commodities, bonds, and crypto:

• West Texas Intermediate crude oil rose 0.32% to $76.43 a barrel. Brent crude, the international benchmark, increased 0.25% to $79.36 a barrel.
• Gold was higher by 0.22% to $2,468.70 per ounce.
• The 10-year Treasury yield dropped 7 basis points to 3.92%.
• Bitcoin dropped 2.34% to $60,261.