The S&P 500 edged 0.2% lower in afternoon trading after setting a record high for five straight days. The Dow Jones Industrial Average was up 18 points, or 0.1%, as of 2:25 p.m. Eastern time, and the Nasdaq composite was 0.4% lower.

Intel’s drop of 12.1% was dragging on the market even though the chip company reported stronger profit for the last three months of 2023 than analysts expected. Its forecasts for revenue and profit for the start of 2024 fell short of Wall Street’s estimates.

Visa also sank, down 1.7%, despite reporting better results than expected. Analysts called the figures solid but highlighted how the company described some slowing trends for January so far.

The U.S. stock market is nevertheless closing out another winning week as reports keep suggesting inflation is cooling while the economy continues to power higher. The unexpected backdrop has hopes high that Wall Street’s dream scenario can come true: one where a resilient economy drives profits higher for companies, while inflation moderates enough to get the Federal Reserve to cut interest rates many times this year.

The latest report on Friday showed the measure of inflation the Fed prefers to use behaved just about exactly as expected in December. Overall inflation by that measure was 2.6% during the month, matching November’s rate.

The Fed pays more attention to the inflation figure after ignoring prices for food and fuel, which can zigzag sharply month to month. That figure cooled to 2.9% from 3.2% and was a bit better than economists expected.

At the same time, spending by U.S. consumers strengthened by more in December than expected. That helped calm worries that a resilient U.S. economy, which has so far refused to fall into a long-predicted recession, would mean upward pressure on inflation.

The hope is still for the labor market to soften in upcoming months, further cooling pressure on inflation, but not enough to halt the economy’s growth. That has the market looking forward to what EY Chief Economist Gregory Daco calls “the ‘holy grail’ of non-inflationary growth.”

Treasury yields yo-yoed in the bond market following the report but later rose modestly. The yield on the 10-year Treasury climbed to 4.16% from 4.12% late Thursday.

The Federal Reserve’s next meeting next week will likely end with no change to interest rates, but traders are split on whether it could begin cutting rates in March. That would be a sharp turnaround from the last two years, when the Fed hiked its main interest rate to the highest level since 2001 in hopes of slowing the economy and hurting investment prices enough to get inflation under control.

Traders also are betting on the Fed cutting interest rates many more times this year than the three it’s indicated, according to data from CME Group.

Critics say that overzealousness may be setting financial markets up for disappointment after their big rallies in recent months.

For now, though, the mood is still mostly ebullient on Wall Street.

American Express jumped 6.6% for one of the bigger gains even though it reported weaker results for the latest quarter than expected. It gave forecasts for revenue and profit for the full year of 2024 that were stronger than analysts’, while also announcing plans to boost its dividend payout to investors.

Colgate-Palmolive climbed 2% after the company in control of more than 40% of the global toothpaste market reported stronger profit and revenue for the latest quarter than analysts forecast.

In stock markets abroad, indexes were higher across much of Europe but mixed in Asia.

Hong Kong’s Hang Seng slumped 1.6% to give back some of its strong gain for the week, which was spurred by Chinese authorities’ moves to stabilize markets and the world’s second-largest economy. Japan’s Nikkei 225 fell 1.3% to pare its big gain for the year so far.

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AP Business Writers Yuri Kageyama and Matt Ott contributed.