U.S. stock indexes on Friday clambered higher after a report on June retail sales came in stronger than expected, with stocks set to cap a week featuring assurances by Federal Reserve Chairman Jerome Powell that surging inflation was a temporary phenomenon.

How are stock benchmarks trading?

The Dow Jones Industrial Average
DJIA,
-0.39%

55 points, or 0.1%, higher at 35,032, with the blue-chip benchmark touching an intraday high near a record at 35,091.56.

The S&P 500 index
SPX,
-0.31%

was up 7 points at 4,366, a gain of 0.2%.

The Nasdaq Composite Index
COMP,
-0.26%

traded 34 points, or 0.2%, higher at 14,574.

On Thursday, the Dow rose 53.79 points or 0.15% today to 34,987.02, the S&P 500 fell 14.27 points, or 0.33%, to 4,360.03, while the Nasdaq Composite Index closed 101.82 points lower, or 0.70%, at 14,543.13.

For the week, the Dow is currently up 0.5%, marking its fourth straight gain; the S&P 500 is headed for a weekly rise 0.1%, while the Nasdaq is looking at a weekly decline of 0.6%, the first such decline in four weeks. The small-capitalization Russell 2000 index
RUT,
+0.07%

was on track for a 4% drop for the week, which would mark its third straight loss.

What’s driving the market?

U.S. stock indexes were headed slightly higher on Friday led by technology stocks but after Federal Reserve Chair Jerome Powell reiterated that inflation would rise for a few months before slowing.

Investors have been digesting what has been mostly upbeat second-quarter corporate earnings results but the data has been mixed.

June retail sales data may have done little to quell the escalating concerns around inflation. Sales at U.S. retailers increased 0.6% last month, compared with a forecast for a 0.4% decline. Excluding autos, retail sales advanced 1.3%, almost three times as much as Wall Street expected.

The report illustrates Americans are paying more for a variety of goods and services, even as the Federal Reserve contends it is just a temporary phenomenon. 

Read: A ‘robust’ U.S. economy is strengthening, Fed’s Beige Book finds, but it is grappling with big shortages and higher inflation

Meanwhile, the spread of the more transmissible delta coronavirus variant has fueled jitters on Wall Street but the path of least resistance continues to be higher for stocks and lower for Treasury yields, with the 10-year benchmark
TMUBMUSD10Y,
1.313%

briefly slipping below 1.30% on Thursday. The slide in yields suggests that fixed-income investors harbor some doubts about economic growth in the wake of the pandemic or also share Powell’s view that inflation will be short-lived.

Separately, the U.S. President Joe Biden on Friday will join Pacific Rim leaders, including China’s Xi Jinping and Russia’s Vladimir Putin in a virtual meeting to develop strategies to help economies rebound from the resurgent COVID-19 pandemic.

Read: Inflation is surging. How high will it go? Check out MarketWatch’s new tracker.

And in Germany, Chancellor Angela Merkel has pledged rapid help for disastrous flooding that has killed more than 90 and left hundreds missing in the western part of the country, as persistent rains have left rivers and reservoirs overflowing.

Which companies are in focus?

Charles Schwab Corp. SCHW reported second-quarter earnings Friday that showed profit falling below estimates, while revenue beat, as it opened 1.7 million new brokerage accounts, exceeding 1 million for a third straight quarter. Shares of the company were down over 2%.

Shares of GameStop CorpGME rose 2.8% Friday, to extend a bounce that started late in the previous session, and them on track to snap a five-day losing streak.

Kansas City Southern KSU said Friday it swung to a second-quarter net loss, as a result of more than $700 million in merger costs, while also reporting an adjusted profit and revenue that came up short of expectations. Shares were down 0.5%.

Bristol-Myers Squibb Co. BMY said Friday a late-stage study of a treatment for head and neck cancer failed to meet its main goals. Shares were mostly flat.

U.S.-listed Chinese ride-hailing company Didi Global
DIDI,
-2.59%

 tumbled 3% after state security and police officials were sent to the company’s offices Friday as part of a cybersecurity investigation, AP reported.

Intel
INTC,
+0.29%

 was in focus after The Wall Street Journal reported that the semiconductor giant was exploring a deal to acquire chip maker GlobalFoundries for around $30 billion. Shares of Intel were up 0.8%.

Moderna Inc.
MRNA,
+9.56%
,
a biotechnology company catapulted to fame after it produced a highly effective COVID-19 vaccine, is set to join the S&P 500 index, replacing Alexion Pharmaceuticals Inc.
ALXN,
-0.31%
.
Shares of Moderna were up 5.4% and Alexion was off 0.5%.

How are other assets faring?

The yield on the 10-year Treasury note was up 3 basis points to 1.33%. Yields and bond prices move in opposite directions.

The ICE U.S. Dollar Index DXY, a measure of the currency against a basket of six major rivals, was up less than 0.1%.

Oil futures rose, with the U.S. benchmark CL00 up 0.3% but down more than 3% for the week, while gold futures GC00 slipped 0.1% to $1,826.30 an ounce, but was headed for a weekly rise.

In European equities, the Stoxx Europe 600 SXXP fell less than 0.1% and London’s FTSE 100 UKX traded less than 0.1% higher.

In Asia, the Shanghai Composite SHCOMP fell 0.7% but booked a 0.4% gain, the Hang Seng Index HSI advanced 0.03% but logged a 2.4% weekly rise, and Japan’s Nikkei 225 NIK closed 1% lower but notched a 0.2% gain.

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