US stocks turned higher after a crucial inflation report showed prices cooled more than expected in September.
The tech-heavy Nasdaq Composite rose by 0.9% while the S&P 500 climbed 0.5% and the Dow Jones Industrial Average rose slightly. Stocks fell fractionally the day before.
Stocks continue to be caught in the undertow of rising bond yields and volatile oil prices as the war in Iran enters its seventh month, keeping inflation concerns in play. Crude oil futures stabilised on Wednesday in the mid-$90-per-barrel range.
Traders pared back bets that the Federal Reserve will hike interest rates at its October meeting to 35% from over 70% odds a day ago, shifting the bias to a Fed hold, per CME Group. The shift came after New York Federal Reserve president John Williams said there was “no need for urgency” to raise rates in October, which markets viewed as a sign Fed rates could stay put.
A cool reading on the Personal Consumption Expenditures (PCE) index reinforced the notion that the Fed can wait to hike. On Wednesday, the Fed’s preferred inflation gauge rose 3.4% in August, less than expectations for 3.7%.
Yahoo Finance
