PARIS (Reuters) – The New York Stock Exchange opened higher on Thursday after the release of the PCE index of consumer prices in the United States in July, which came out broadly in line with expectations, without calling into question the hypothesis of a status quo on Fed rates in September.
In early trading, the Dow Jones index gained 111.49 points, or 0.32%, to 35,001.73 points and the broader Standard & Poor’s 500 rose 0.19% to 4,523.46 points.
The Nasdaq Composite gained 0.3%, or 42.25 points, to 14,061.56.
An hour before the opening of Wall Street, the Commerce Department announced that the “PCE” consumer price index, the measure of inflation favored by the American Federal Reserve (Fed), had emerged in July at the same level than the previous month. And if its increase over one year accelerated to 3.3%, it remains in line with the Reuters consensus.
Core PCE inflation, which excludes volatile elements, also stagnated on a monthly basis and is also unsurprising on an annual basis.
“This data is very consistent with an economy that appears to be slowing at a sustainable pace, which likely indicates the Fed is done with raising rates,” said Art Hogan, chief market strategist at B Riley Wealth.
“If inflation continues to decline, by the middle of next year the Fed will likely feel that its monetary policy is too tight,” he added.
In values, Salesforce jumped 5.17%, the professional software publisher having raised its sales forecast for the current quarter after a better-than-expected profit in the second quarter.
Victoria’s Secret, on the other hand, fell 4.23% on lackluster second quarter results and a disappointing third quarter forecast, while Dollar General plunged 16.54% as the retailer lowered its revenue forecast to annual business on a like-for-like basis.
Microsoft is in the green as the group announced its intention to dissociate its Teams messaging from its Office suite in order to avoid a possible fine from the European Commission.
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(Written by Claude Chendjou, edited by Jean-Stéphane Brosse)
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