01:23 PM EDT, 05/31/2024 (MT Newswires) -- US equity indexes traded mixed Friday after an in-line inflation report reinforced recent comments from policymakers that more evidence is needed before kicking off the easing cycle.

The Nasdaq Composite fell 1.5% to 16,486.1, and the S&P 500 declined 0.6% to 5,201.2. The Dow Jones Industrial Average, however, rose 0.3% to 38,214.3. The communication services and consumer discretionary sectors were the steepest decliners besides technology. Energy, healthcare, and real estate led the gainers.

The personal consumption and expenditures price index rose 0.3% for a third consecutive month in April, meeting expectations. The year-over-year rate remained at 2.7%, in line with forecast. The core PCE price index grew 0.2%, in line with expectations, following a 0.3% gain in March. The year-over-year rate remained at 2.8% for the third consecutive month, matching market expectations.

"While April's inflation numbers are headed in the right direction once again, Fed governors are likely to continue their exercise in patience, with the first rate cut occurring closer to the end of the year," TD Economics said in a note.

The US 10-year Treasury yield fell 4.2 basis points to 4.51%. The two-year yield declined 3.8 basis points to 4.89%.

The probability of the Fed starting its easing cycle in September rose to 47% by Friday afternoon from 45% in the previous day, according to the CME FedWatch Tool.

There is a contingent in the Federal Open Market Committee that looks at the current economic situation as glass as half full, CIBC said in a note. "But even with that attitude, they will need to see a string of good inflation reports from here on out and more evidence that demand is at least not perking up to feel ready to cut this year. With service inflation easing and consumers pulling back, today is a good start."

Further, in economic news, the Institute for Supply Management's Chicago Purchasing Managers' Index fell to 35.4 in May from 37.9 in April, compared with 41.6 expected in a survey compiled by Bloomberg, indicating a faster pace of contraction. Other regional manufacturing data already released for May have been mixed. The national ISM manufacturing index is due Monday.

West Texas Intermediate crude oil fell 0.9% to $77.24 a barrel.

In company news, Zscaler ( ZS ) shares jumped 4.6% intraday, among the top performers on the Nasdaq, after the company overnight reported a stronger-the-expected surge in fiscal Q3 earnings and sales while raising its full-year outlook.

The steepest decliner on the tech-heavy index was MongoDB ( MDB ) , with shares sinking 24% after the company overnight cut its guidance for the full financial year.

Gold slid 0.4% to $2,356.01 an ounce, and silver sank 2.9% to $30.61.