S&P 500 Retreats After Hitting Fresh Records: Investor Sentiment Improves, But Fear & Greed Index Remains In 'Neutral' Zone

The CNN Money Fear and Greed index showed further improvement in overall market sentiment, while the index remained in the “Neutral” zone on Friday.

U.S. stocks settled lower, as the S&P 500 recorded losses after hitting fresh records on Friday. Some mega-cap tech stocks closed lower, with shares of Nvidia Corp. NVDA falling more than 3%, while Tesla Inc. TSLA lost over 1% during the session.

All three major indices recorded their second consecutive positive week, with the S&P 500 and Nasdaq each gaining around 1.7% last week, while the Dow gained 2.2%.

US President Donald Trump refrained from imposing new tariffs during his first week and escalated pressure on the Federal Reserve, urging the central bank to lower interest rates.

Twilio Inc. TWLO shares jumped more than 20% on Friday after the company issued fourth-quarter earnings guidance above estimates and a year-over-year revenue increase. Multiple analysts raised their price targets on the stock.

On the economic data front, the S&P Global Services PMI declined to 52.8 in January from 56.8 in the previous month, compared to market expectations of 56.5. The S&P Global Manufacturing PMI rose to 50.1 in January versus 49.4 in December, versus market estimates of 49.7

Most sectors on the S&P 500 closed on a positive note, with communication services, utilities, and consumer staples stocks recording gains on Friday. However, information technology and energy stocks bucked the overall market trend, closing the session lower.

The Dow Jones closed lower by over 140 points to 44,424.25 on Friday. The S&P 500 fell 0.29% to 6,101.24, while the Nasdaq Composite fell 0.50% at 19,954.30 during Friday's session.

Investors are awaiting earnings results from AT&T Inc. T, Nucor Corp. NUE, and Sanmina Corp. SANM today.

What is CNN Business Fear & Greed Index?

At a current reading of 48.7, the index moved to the “Neutral” zone on Friday, versus a prior reading of 46.4.

The Fear & Greed Index is a measure of the current market sentiment. It is based on the premise that higher fear exerts pressure on stock prices, while higher greed has the opposite effect. The index is calculated based on seven equal-weighted indicators. The index ranges from 0 to 100, where 0 represents maximum fear and 100 signals maximum greediness.

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