Dow rises 300 points after in-line PCE inflation report: Live updates

The Dow Jones Industrial Average climbed on Friday following the release of crucial inflation data.

The 30-stock index advanced 370 points, or 0.7%. The S&P 500 added 0.6%, while the Nasdaq Composite rose 0.4%.

August’s personal consumption expenditures price index, the Federal Reserve’s preferred inflation measure, showed that core inflation – a measure excluding food and energy costs – ran at a 2.9% seasonally adjusted annual rate. That was in line with what economists polled by Dow Jones were expecting.

The all-items index showed an annual rate of 2.7% as well as a monthly gain of 0.3%, in line with expectations as well. Markets continue to price in two quarter-point rate cuts at the Fed’s upcoming meetings, per the CME FedWatch tool, which is what the central bank has projected.

The outcome swayed market reaction a bit, with stock futures ticking higher, and came on the heels of solid jobs data released Thursday and a strong upward revision in second-quarter gross domestic product to 3.8% slightly dampened bullish sentiment. Investors fear fewer jobless claims could mean that the economy is in decent shape and therefore give the Fed less reason to cut interest rates.

“Following a three-day pullback in the broader market, this is good enough to pull buyers off the sidelines,” said David Russell, global head of market strategy at TradeStation. “Yesterday’s claims and GDP revision undermined the dovish narrative, but today’s PCE calms some of those worries. No news is good news.”

Consumer sentiment in September was also practically in line with expectations, with the University of Michigan reading only coming in slightly lower than expected. Notably, sentiment for the month especially held steady among those with bigger stock holdings.

The market’s third consecutive day in the red on Thursday was spurred by continued losses in software giant Oracle and other artificial intelligence players amid questions over the strength of the AI trade. Oracle is also down more than 7% for the week.

Week to date, the S&P 500 is down 0.3%. The tech-heavy Nasdaq Composite has lost 0.7%, while the Dow Jones Industrial Average is around flat.