(Reuters) – The New York Stock Exchange opened higher on Friday after data showed a slowdown in U.S. inflation in February, supporting hopes for a looser monetary policy on interest rates. ‘interest.
In early trading, the Dow Jones index gained 127.48 points, or 0.39%, to 32,986.51 points and the broader Standard & Poor’s 500 rose 0.30% to 4,062.79 points.
The Nasdaq Composite took 0.19%, or 22.50 points, to 12,035.97.
Data from the U.S. Commerce Department released on Friday shows that the Personal Consumption Expenditure (PCE) price index, the Federal Reserve’s (Fed) favorite inflation gauge, is showing signs of slowing, but remains elevated . It rose 0.3% in February on a minus, after accelerating 0.6% in January.
Year on year, the PCE price index also slowed to rise 5.0% in February after rising 5.3% in January.
According to CME Group’s Fedwatch Barometer, traders are torn between a 25 basis point Fed rate hike and a May pause scenario.
“As the Fed rate hikes begin to gain momentum about a year after they begin, this may be a sign that these hikes are starting to slow inflation,” said Brandon Pizzurro, chief investment officer. public at Guidestone Capital Management.
The yield on 10-year US Treasuries fell more than three basis points after the data was released, to 3.518%.
This Friday marks the end of a turbulent first quarter for equity markets, hit by the shockwaves of the collapse of two US regional banks, the difficulties of two leading European banks and the reassessment of expectations for interest rates in the face of fears of the impact of the increase in the cost of credit on the banking system.
The larger-than-expected rise in weekly jobless claims in the United States, released on Thursday, boosted hopes that the Fed is close to the end of its rate hike cycle.
Final results from the University of Michigan’s monthly survey of US household sentiment are expected at 1400 GMT.
In stocks, Virgin Orbit Holdings is down 40% as the rocket maker said it would lay off around 85% of its staff after it was unable to raise new investment.