Stocks predominantly advanced on Friday, with key indices showing gains after a mixed performance in the prior session.Currently, the Nasdaq has climbed 146.59 points, or 0.8%, to 17,663.02, while the S&P 500 has increased by 32.81 points, or 0.6%, to 5,624.77. The Dow displays a more modest rise, up 64.15 points, or 0.2%, to 41,399.20, yet remains on track for a record closing high.The upward movement in Wall Street comes in the wake of the Commerce Department’s release of U.S. consumer price inflation data, considered a key metric by the Federal Reserve. The report indicated that consumer prices grew in line with economist expectations in July, while the annual rate of price growth remained unexpectedly flat.According to the Commerce Department, the personal consumption expenditures (PCE) price index increased by 0.2% in July, matching the previous 0.1% rise in June and meeting expectations. The core PCE price index—excluding food and energy prices—also rose by 0.2%, consistent with both June’s increase and economist predictions.The report further highlighted that the annual growth rates for both the PCE price index and the core PCE price index remained unchanged at 2.5% and 2.6%, respectively. Economists had anticipated a 0.1 percentage point uptick for both indexes.With a broad consensus that the Federal Reserve will cut interest rates next month, the stable yearly price growth has fueled optimism for a more aggressive rate-cutting approach by the central bank. Nationwide Senior Economist Ben Ayers noted, “The additional cooling of inflation could permit the Fed to implement more substantial rate reductions at upcoming meetings, particularly if the labor market shows significant weakening.”Ayers added, “We continue to forecast more cautious 25 basis points cuts at the remaining three FOMC meetings of 2024, though larger reductions remain a possibility should economic conditions deteriorate more than expected.”Meanwhile, the University of Michigan released a separate report indicating a slight improvement in U.S. consumer sentiment for August, revising its consumer sentiment index upward to 67.9 from a preliminary reading of 67.8. Though just shy of economist forecasts of 68.0, the index sits slightly above July’s reading of 66.4.Regarding inflation, the report showed that year-ahead inflation expectations dipped to 2.8% in August from 2.9% in July, while long-term inflation expectations remained steady at 3.0%.**Sector Highlights:**Semiconductor stocks saw a substantial surge, driving the Philadelphia Semiconductor Index up by 2.5%. Intel (INTC) was a significant contributor, soaring 8.7% amid Bloomberg reports suggesting the company is evaluating strategic options, including separating its product-design and manufacturing divisions.Airline stocks also demonstrated considerable strength, with the NYSE Arca Airline Index gaining 1.6%. Notable recovery was observed in computer hardware stocks following recent downturns. Conversely, oil service stocks declined due to a sharp drop in crude oil prices.**Global Markets:**In Asia-Pacific, stock markets largely moved higher on Friday. Japan’s Nikkei 225 Index rose by 0.7%, while Hong Kong’s Hang Seng Index jumped by 1.1%.European markets mirrored this upward trend, with France’s CAC 40 Index, the U.K.’s FTSE 100 Index, and Germany’s DAX Index all inching up by 0.2%.**Bond Market:**U.S. treasuries showed little direction, following a modest downturn in the previous session. The yield on the benchmark ten-year note, which inversely affects its price, remained unchanged at 3.867%.The material has been provided by InstaForex Company – www.instaforex.com
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