US open: Stocks edge higher after mixed economic data

US stocks started the last trading session of the month in positive territory, though gains were only modest as investors digested a barrage of mixed economic data on the labour market, consumer spending and inflation.

By 0945 ET, the Dow Jones Industrial Average and Nadsaq both gained 0.3%, while the S&P 500 rose 0.2%.

The S&P 500 finished Wednesday's session at 4,514.87 – its highest close since 7 August. Nevertheless, the index is still down for August as a whole and is on track to finish in the red for the month – its first monthly loss since February.

Busy day for data

US consumer spending rose more than expected and inflation picked up in July, according to the Bureau of Economic Analysis, which will likely raise more concerns that the Federal Reserve's strategy of raising interest rates is doing little to stop an overheating economy.

Personal consumption expenditures (PCE) in current dollar terms rose 0.8% in July, picking up from a revised 0.6% increase seen in June. Economists had pencilled in a figure of 0.5%.

The PCE price index, the Fed's favoured gauge of inflation, rose by 3.3% year-on-year, accelerating from 3% in June. The core PCE price index, which strips out volatile items like food and energy, picked up to 4.2%, from 4.1%.

The BEA also reported that personal incomes rose 0.2% in July, after a 0.3% gain the previous month, while disposable incomes were unchanged after growing 0.2% previously.

Meanwhile, initial weekly jobless claims came in at 228,000 last week, down from a revised 232,000 the week before and missing the 235,000 forecast.

Lastly, the Chicago purchasing managers index, a closely watched business barometer, jumped from 42.8 to 48.7. Any number below 50 represents a contraction in activity, but analysts were expecting a smaller rise to 44.1.

Stock movers

Tech stocks were putting in decent gains after a host of earnings reported after the closing bell on Wednesday.

Digital identity management firm Okta, CRM software group Salesforce and cybersecurity firm CrowdStrike all gained after beating second-quarter forecasts and giving bullish outlooks for coming quarters.

Meanwhile, retailers Chewy and Five Below were out of favour after reporting their quarterly results, while Victoria's Secret was putting in a decent performance despite swinging to a loss in its second quarter.