Wall Street surges at open after soft inflation data By Reuters

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<span>© Reuters. FILE PHOTO: Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., October 27, 2023. REUTERS/Brendan McDermid/File Photo</span><br />
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<p>By Sruthi Shankar and Amruta Khandekar</p>
<p>(Reuters) – The main U.S. stock indexes were poised for strong opening gains on Tuesday after cooler-than-expected inflation data boosted expectations that the Federal Reserve was done raising interest rates.</p>
<p>Data showed that U.S. consumer prices were unchanged in October amid lower gasoline prices, and underlying inflation showed signs of slowing. </p>
<p>In the 12 months through October, the CPI climbed 3.2% after rising 3.7% in September, while economists polled by Reuters had forecast a 3.3% gain on a year-on-year basis.</p>
<p>Core prices, which exclude the volatile food and energy components, rose 4.0%, below economists’ estimate of a 4.1% increase. </p>
<p>“We’re happy to see both headline and core CPI come in lower than expected. It’s telling us that the Fed is done, there’s nothing left for it to do here,” said Thomas Hayes, chairman at hedge fund Great Hill Capital at New York.</p>
<p>“You have to keep an eye on the potential for deflation, but right now this is Goldilocks. This is what the Fed was looking for, slowing inflation, slowing labor market and the economy’s holding up at the same time.”</p>
<p>Following the data, traders erased bets the Fed will raise borrowing costs any further and piled into bets on rate cuts starting by May. </p>
<p>U.S. Treasury yields dropped after the data, with the two-year yield, which best reflects short-term interest rate expectations, sliding to two-week lows of 4.872%. [US/]</p>
<p>That in turn lifted megacap-growth stocks such as Nvidia (NASDAQ:), Alphabet (NASDAQ:), Amazon.com (NASDAQ:) and Tesla (NASDAQ:) up between 1.8% and 4.3% in premarket trading.</p>
<p>Wall Street’s main indexes have seen a strong rebound in November, driven by a better-than-expected earnings season and expectations that U.S. interest rates were near their peak.</p>
<p>The gains came even as Fed Chair Jerome Powell last week left the door open to further policy tightening should progress toward the Fed’s 2% inflation goal stall out.</p>
<p>Fed Vice Chair for Supervision Michael Barr is set to testify before the Senate Banking Committee, while investors will parse comments from Cleveland Fed President Loretta Mester and Chicago Fed chief Austan Goolsbee later in the day.</p>
<p>Focus is also on negotiations by U.S. lawmakers over a funding bill, as lawmakers face an end-of-week deadline to fund the federal government. U.S. House of Representatives Speaker Mike Johnson said on Tuesday he thinks the House will pass a short-term spending bill to avert a partial government shutdown beginning on Saturday.</p>
<p>At 8:53 a.m. ET, were up 390 points, or 1.13%, were up 64.5 points, or 1.46%, and were up 287.25 points, or 1.85%.</p>
<p><span itemscope="" itemtype="http://schema.org/Corporation"><span itemprop="name"> Snap Inc </span></span> (NYSE:) shares rose 6.6% following news that Amazon.com will allow Snapchat users in the United States to buy some products listed on the ecommerce company directly from the social media app.</p>
<p><span itemscope="" itemtype="http://schema.org/Corporation"><span itemprop="name"> Home Depot </span></span> (NYSE:) gained 2.2% after the U.S. home improvement chain beat quarterly profit estimates and posted a lower-than-expected drop in comparable sales as it tapped into a switch by customers to small-scale projects and essential repair work.</p>
<p>Fisker (NYSE:) slid 16.8% after the electric-vehicle startup slashed its 2023 production forecast as it struggles to ramp up deliveries, and flagged weakness in internal controls over financial reporting. </p>
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<br /><a href="https://www.investing.com/news/economy/futures-edge-higher-ahead-of-inflation-data-3233585">Source link </a></p><p>The post <a href="https://forextraderhub.com/wall-street-surges-at-open-after-soft-inflation-data-by-reuters.html">Wall Street surges at open after soft inflation data By Reuters</a> first appeared on <a href="https://forextraderhub.com">Forex Trader Hub</a>.</p>