US close: Stocks higher following PCE reading

dl nyse new york stock exchange new york city nyc wall street wall st nasdaq markets trading finance unsplash — Sharecast / David Vives via Unsplash

US stocks turned in modest gains on Thursday after a closely watched gauge of inflation showed that price pressures had continued to ease last month, reigniting hopes of a rate cut in the first half of the year.

At the close, the Dow Jones Industrial Average was up 0.12% at 38,996.39, while the S&P 500 advanced 0.52% to 5,096.27 and the Nasdaq Composite saw out the session 0.90% firmer at 16,091.92.

The Dow closed 47.37 points higher on Thursday, reversing losses recorded in the previous session.

According to the Department of Commerce, the so-called price deflator for personal consumption expenditures rose by 2.4% year-on-year in January, in line with forecasts and following a 2.6% annual increase in December. Meanwhile, the core rate eased to 2.8% from 2.9%, matching economists' expectations.

Meanwhile, data showed that personal income growth surged to 1.0% month-on-month in January, after the 0.3% increase seen in December, though that didn't translate into a jump in spending growth, which slowed to just 0.2% from 0.7%. The weak consumer spending outcome was thought to be a pullback from strong holiday shopping sales in December and weather-related weakness in auto sales.

In other news, jobless claims rose to 215,000 in the week to 23 February, according to the Labor Department, up from a revised 202,000 the week before and ahead of the 210,000 expected by economists.

In the corporate space, CRM software provider Salesforce fell despite beating forecasts with its quarterly earnings and launching a share buyback, as it disappointed the market with weak revenue targets for the coming financial year.

Also falling was cloud-computing firm Snowflake which dropped after underwhelming with its growth outlook and announcing the surprise and immediate departure of its chief executive.

Reporting by Iain Gilbert at Sharecast.com

Dow Jones - Risers

Salesforce.Com Inc. (CRM) $308.82 3.02%
Intel Corp. (INTC) $43.05 2.52%
Microsoft Corp. (MSFT) $413.64 1.45%
Dow Chemical Co. (DOW) $55.88 1.42%
Caterpillar Inc. (CAT) $333.96 1.34%
JP Morgan Chase & Co. (JPM) $186.06 0.91%
Home Depot Inc. (HD) $380.61 0.79%
3M Co. (MMM) $92.12 0.72%
Walt Disney Co. (DIS) $111.58 0.70%
Cisco Systems Inc. (CSCO) $48.37 0.65%