by Sinéad Carew and Sruthi Shankar

(Reuters) – The New York Stock Exchange ended slightly higher on Wednesday after the publication of inflation data reinforced investors’ hopes that the Federal Reserve (Fed) has ended its campaign of rate hikes, while Upbeat forecasts from retailer Target added to the optimism.

The Dow Jones index gained 0.47%, or 163.51 points, to 34,991.21 points.

The broader S&P-500 gained 7.18 points, or 0.16%, to 4,502.88 points.

The Nasdaq Composite advanced 9.46 points (0.07%) to 14,103.84 points.

S&P-500 and Nasdaq recorded their biggest increase in more than six months on Tuesday after the publication of data on US consumer prices which fueled optimism about the potential end of the monetary tightening cycle started by the Fed in March 2022 to stem the surge in inflation.

A report released on Wednesday shows that producer prices in the United States unexpectedly slowed in October to a three-and-a-half year low, driven by falling fuel prices, confirming a weakening of inflationary pressures. .

Separate data released today showed that retail sales fell less than expected last month.

“This data reaffirms Tuesday’s message that the Fed appears to have navigated the soft landing rather well” of the American economy, commented Ronald Temple, chief strategist at Lazard.

Markets anticipate that the US central bank will keep interest rates unchanged again in December, as it did earlier this month, and expect a first cut next May.

Adding to the optimism, the US House of Representatives approved with bipartisan support a temporary funding text intended to avoid a “shutdown” (partial closure of federal administrations) starting Friday evening, bringing Congress closer to an exit from ‘dead end.

Investors were also awaiting new information on the meeting between American President Joe Biden and his Chinese counterpart Xi Jinping, on the sidelines of the Apec summit organized in San Francisco, with the hypothesis of an easing of tensions between the two superpowers .

Among the major sectors of the S&P-500, energy was the worst performer, ending the session down 0.3%. Public services also ended up in the red.

Communication services rose, notably driven by gains at Walt Disney following reports that activist fund ValueAct Capital had taken a stake in the entertainment giant.

Target jumped 17.8%, recording its largest percentage gain since August 2019, after reporting a better-than-expected profit forecast for the current quarter, citing cost relief in its supply chains.

Other retailers, including Macy’s and Kohl’s, also ended up 7.5% and nearly 9% respectively, in the wake of Target.

Sirius XM ended up 6% as Berkshire Hathaway announced its entry into the audio entertainment company.

( Jean Terzian)

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