U.S. stocks advance on easing inflation pressures-Xinhua

U.S. stocks advance on easing inflation pressures

Source: Xinhua

Editor: huaxia

2023-07-01 07:47:00

NEW YORK, June 30 (Xinhua) -- U.S. stocks ended higher on Friday after the Federal Reserve's favored gauge showed signs of cooling in inflation.

The Dow Jones Industrial Average rose 285.18 points, or 0.84 percent, to 34,407.60. The S&P 500 added 53.94 points, or 1.23 percent, to 4,450.38. The Nasdaq Composite Index increased by 196.59 points, or 1.45 percent, to 13,787.92.

All the 11 primary S&P 500 sectors ended in green, with technology and consumer discretionary sectors leading the gainers up 1.82 percent and 1.37 percent, respectively. Meanwhile, the real estate sector registered the smallest growth of 0.51 percent.

U.S. stocks advanced on Friday as the rally in tech mega caps gained further traction. Apple grew 2.3 percent to close above a 3 trillion U.S. dollars market cap, lifted by signs of cooling inflation and bets that the iPhone maker will successfully expand its market share. U.S. chipmaker Nvidia surged 3.6 percent, bringing its yearly gains to around 190 percent. Netflix gained 2.9 percent, while Amazon, Meta Platforms and Microsoft rose 1.9 percent, 1.9 percent and 1.6 percent, respectively.

After a string of positive economic data released this week, the latest report on Friday eased investors' inflation fears further, helping U.S. stocks finish a strong first half of the year.

The personal consumption expenditures (PCE) price index, a number closely watched by the Fed, rose 3.8 percent in May on a 12-month basis, the slowest increase since April 2021, according to data issued by the U.S. Bureau of Economic Analysis on Friday. The PCE price index increased 0.1 percent on a monthly basis in May.

Excluding food and energy, the so-called core PCE price index increased 0.3 percent in May on a monthly basis. The core PCE rose 4.6 percent year over year, down from 4.7 percent in April and below estimates, according to the U.S. Bureau of Economic Analysis.

"This is excellent news on the inflation fight," said Jamie Cox, managing partner for Harris Financial Group, in an interview with CNBC. "If you don't believe disinflation is happening, you aren't paying attention. The Fed was right to pause and needs to hold firm at these levels to prevent overcorrecting and causing an unnecessary recession to fight a beast that is now under control."

Meanwhile, the University of Michigan Surveys of Consumers reported Friday that the final reading of its consumer sentiment index for June rose to 64.4, up from 59.2 in May, hitting a four-month high.