Investing.com – U.S. stocks opened mixed to start the new month of trading after all three major Wall Street indexes posted strong gains in May.
By 9:37 a.m. ET (1337 GMT), the S&P 500 was up 17 points, or 0.3%, the tech-heavy Nasdaq Composite was up 156 points, or 0.9%, and the 30-share Dow Jones Industrial Average was up 156 points, or 0.9%. , fell. by 25 points or 0.1%.
Bets for September rate cut rise after PCE data came in as expected
Wall Street indexes rose on Friday after data, the Fed’s preferred inflation gauge, matched expectations for April.
PCE figures showed some modest decline in inflation, although they remained well above the Fed’s annual target of 2%.
However, the data, combined with other recent indicators of a cooling U.S. economy, has prompted some to bet that the central bank will begin cutting interest rates in September.
Traders put the odds of a 25 basis point rate cut in September at about 47%, and about a 45% chance the Fed would hold it, according to . This positioning contributed to the growth of US stocks.
On Friday, the index rose 0.8% to 5,277.51 points, rising 1.5% to 38,686.32 points. The pair lagged weakness in technology stocks, ending at 16,735.02.
Nonfarm payrolls, approach to Fed meeting
Market watchers are now turning their attention to upcoming May data due later this week, which should provide more signals on the labor market – another key consideration for the Fed in cutting interest rates.
The central bank is inclined to maintain rates at a stable level. But any comments on future betting decisions will be closely watched.
Fed policymakers continue to urge patience on rate cuts, saying they would like to see more evidence that inflation is steadily returning to its 2% target. On Monday, Minneapolis Fed President Neel Kashkari echoed that sentiment, telling the Financial Times that rates may have to be left unchanged for an “extended” period of time.
Ambar Warrick contributed to this report.