by Noel Randewich
(Reuters) – The New York Stock Exchange ended higher on Friday as the release of the Federal Reserve’s most-watched PCE inflation data reinforced investors’ expectations for an interest rate cut in September.
The Dow Jones index gained 0.6%, or 228.03 points, to 41,563.08 points.
The broader S&P 500 gained 56.44 points, or 1 percent, to 5,648.40.
The Nasdaq Composite rose 197.194 points, or 1.1%, to 17,713.624 points.
The personal consumption expenditures (PCE) index rose 2.5% in July from a year earlier, data released Friday by the Commerce Department showed.
“Investors are looking at another sign that seems to indicate a soft landing,” said Cameron Dawson, chief investment officer at NewEdge Wealth. “This is another one of those Goldilocks-type reports … The market is getting exactly what it wanted.”
An economic environment is said to be “Goldilocks” when it demonstrates regular growth without fueling excessive inflation.
Traders expect the Fed to cut rates by 25 basis points in September, according to CME Group’s FedWatch tool.
The session caps a tumultuous month on Wall Street, as U.S. labor market data released earlier this month fueled fears the U.S. economy was entering a recession.
The market has since rebounded, with the S&P 500 approaching record levels.
In terms of values, Amazon.com and Tesla rose, as did Broadcom.
Marvell Technology jumped after it said it expected third-quarter results to beat estimates.
Nvidia was also higher, regaining ground after finishing lower the previous day.
Ulta Beauty declined after lowering its full-year earnings forecast due to slowing demand.
( Camille Raynaud)
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