US stocks wavered Friday after cooler-than-expected inflation data put pressure on major indexes. The S&P 500 (^GSPC) and Dow Jones (^DJI) drifted below the flatline while the Nasdaq Composite (^IXIC) fell 0.18%, with all three major benchmarks on track for weekly losses exceeding 1%.

The Consumer Price Index showed prices rose 0.2% in January, below economists' expectations of 0.3%, with annual inflation at 2.4%. Core CPI, excluding volatile food and energy, increased 0.3% monthly and 2.5% annually. The report revived trader bets on a June Federal Reserve rate cut, with over half now pricing in a quarter-point reduction that month.

Meanwhile, tech stocks faced heavy selling pressure as AI disruption fears spread to real estate, logistics, and transportation sectors. All seven Magnificent Seven megacaps finished lower, contributing to the broad market decline. Individual stocks saw dramatic moves: Applied Materials (AMAT) surged 10% on strong AI demand outlook, while Pinterest (PINS) tumbled 20% on revenue misses and AI risk concerns. Rivian (RIVN) shares jumped 19% after beating earnings and confirming its R2 EV model remains on track for Q2 deliveries.