US open: Stocks trade higher following PCE reading

dl exchange place wall st street pl new york city nyc ny nyse stock exchange dow jones sp nasdaq finance dollar dollars us usa united states of america — Exchange PlaceSharecast photo / Josh White

Wall Street stocks opened higher on Friday as market participants digested some key inflation data.

As of 1535 BST, the Dow Jones Industrial Average was up 0.85% at 32,914.90, while the S&P 500 was 1.65% firmer at 4,124.65 and the Nasdaq Composite came out the gate 2.37% stronger at 12,019.15.

The Dow opened 277.71 points higher on Friday, extending gains recorded in the previous session.

With the Dow Jones on track to snap a seven-week-long losing streak, Friday's primary focus was a report that revealed a key measure of inflation in the US dipped last month, even as personal incomes and spending continued growing at a steady clip. According to the Department of Commerce, in April personal incomes and spending grew at a month-on-month pace of 0.4% (consensus: 0.5%) and 0.7% (consensus: 0.6%), respectively. The annual rate of change in the headline price deflator for personal consumption expenditures meanwhile slipped from 6.6% for March to 6.3% this time around.

Elsewhere on the macro front, America's shortfall in trade with the rest of the world fell sharply last month as imports declined. According to a preliminary estimate from the Department of Commerce, America's deficit in its international trade in goods and services shrank by 15.9%, in seasonally adjusted terms, to reach $105.9bn. That was considerably less than the -$115.0bn deficit that economists had pencilled-in.

Finally, the University of Michigan's May consumer sentiment index was revised down from a preliminary reading of 59.1 to 58.4 - the lowest reading since August 2011 - as consumers continued to hold negative views on current buying conditions for houses and durables, as well as the future outlook for the economy, primarily due to concerns over inflation.

Also drawing an amount of investor attention was news that Ukraine's President has held out an olive branch to the Kremlin, even as he sounded a downbeat note on the likelihood that Moscow would take it.

"There are things to discuss with the Russian leader," Volodymyr Zelenskiy reportedly said in remarks delivered to an Indonesian thinktank. "I'm not telling you that to me our people are eager to talk to him, but we have to face the realities of what we are living through."

In the corporate space, Gap shares slumped after the retailer lowered its full-year profit guidance, while Ulta Beauty shares rallied in after revealing better-than-expected quarterly results overnight.

No major corporate earnings were slated for release on Friday.

Reporting by Iain Gilbert at Sharecast.com

Dow Jones - Risers

Boeing Co. (BA) $131.72 3.12%
Apple Inc. (AAPL) $147.66 2.70%
Microsoft Corp. (MSFT) $271.42 2.08%
Walt Disney Co. (DIS) $107.63 1.91%
Nike Inc. (NKE) $114.82 1.67%
American Express Co. (AXP) $167.74 1.43%
Visa Inc. (V) $211.40 1.37%
Intel Corp. (INTC) $44.04 1.29%
Caterpillar Inc. (CAT) $215.24 1.06%
3M Co. (MMM) $148.59 1.05%