-
US stock indexes rose following the encouraging PCE report.
-
The S&P 500 and Dow rose, while the Nasdaq was roughly flat.
-
Investors were encouraged by expected inflation, raising the likelihood of a Fed interest rate cut.
US stock indexes closed mostly higher on Friday as a key inflation reading encouraged investors.
The S&P 500 and Dow Jones Industrial Average rose, while the Nasdaq Composite was flat. Nvidia, Microsoft and Amazon all fell.
Investors also got some relief on inflation on Friday after the personal consumption expenditures report came in line with expectations. As expected, core PCE rose 0.2% in April. On an annualized basis, it rose 2.8%, slightly above the market forecast of 2.7%.
“The stock market is betting on slowing economic growth and today’s PCE data reports a soft landing,” said David Donabedian, chief investment officer at CIBC Private Wealth US.
That means there’s still a chance the Fed could cut interest rates this year, a notion bolstered by last week’s downward revision of GDP figures that showed consumer spending was weaker than expected.
“Thursday’s revised GDP report showed a cooling in consumer spending in the first quarter, which should leave open the possibility of one or two rate cuts this year. The latest economic report may continue the bull market in U.S. large caps, but interest-rate sensitive U.S. small caps may continue to tread water until there is a clearer indication of when the first rate cuts will come,” said Eric Sterner, chief investment officer at Apollon Wealth Management.
As of the close of trading at 4pm on Friday, U.S. stock indexes were as follows:
Here’s something else that happened today:
Commodities, Bonds and Cryptocurrencies:
-
West Texas Intermediate crude oil fell 1.41% to $77.10 a barrel, while the international benchmark Brent crude was down 0.71% to $81.29 a barrel.
-
Gold fell 1.12% to $2,371 per ounce.
-
The yield on the 10-year Treasury note fell 5 basis points to 4.49%.
-
Bitcoin fell 1% to $67,651.
Read the original article on Business Insider
