US stocks heading tow third-successive losing week

US stocks extended their losses on Friday as they encountered extended selling that has become a general trait of December ahead of the long holiday weekend.

The S&P 500 (^GSPC) and Dow Jones Industrial Average (^DJI) each sank 0.5% after struggling for direction at the open. The technology-heavy Nasdaq Composite (^IXIC) tumbled 0.9%. The US stock and bond markets will be closed on Monday, Dec. 26, in observance of Christmas Day. Bond markets will close one hour earlier than usual on Friday at 2 p.m. ET.

The Federal Reserve’s favourite inflation gauge, namely the PCE core price index rose at an annual 5.5% in November and 0.1% from the prior month. The PCE data marked a moderation from readings of 6.1% and 0.3%, respectively, in October.

Core PCE, which strips out the volatile food and energy components, rose 4.7% year-over-year and 0.2% on a monthly basis. Meanwhile, personal spending stagnated in November to the weakest print since July.

Investors will also get readings on the latest University of Michigan Consumer Sentiment Survey and new home sales. The Federal Reserve’s preferred measure of inflation continues to go down, which is good news for their most important objective, but unfortunately for the market, it is happening at the same time as consumers continue to reduce their spending.

Stronger spending and higher growth is indirectly bad for the stock market because it is linked to potential stronger hawkish stance to be adopted by the Fed.