Equities were flat to higher Friday as better buying continued after supportive economic indicators. The Dow Jones industrial average eased 0.1 percent while the S&P 500 and the Nasdaq both firmed 0.2 percent. US Treasury yields were lower at the short end and higher at the long end. The dollar and oil prices declined.

Soft landing hopes were bolstered by favorable inflation readings and relatively upbeat demand indicators in the day's personal income and outlays and durable goods reports. Traders chose to focus on the good news as opposed to the unexpectedly poor showing in new home sales for the latest month. Trading was limited as the market is very much in holiday mode headed into the long holiday weekend.

Megacaps were weak, which restrained the major averages even as most stocks rose. Among sectors, best were real estate, consumer staples, communications services, health care, and energy. Consumer discretionary lagged.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.