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Merck ( MRK ) up after US FDA approves therapy for rare lung

condition

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Trump's media firm extends gains after stellar debut

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GameStop ( GME ) faces 'unsustainable' sales decline, shares slide

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Indexes up: Dow 0.77%, S&P 0.46%, Nasdaq 0.22%

(Updated at 2:26 p.m. ET/ 1826 GMT)

By Chuck Mikolajczak

NEW YORK, March 27 (Reuters) - The Dow was the best

performing of the three major indexes on Wednesday, paced by

gains in drugmaker Merck ( MRK ), while as investors looked towards the

next piece of inflation data and Federal Reserve policymaker

commentary for insight on the rate path.

Merck & Co ( MRK ) advanced 4.77% as the biggest boost and

percentage gained on the Dow after the U.S. Food and Drug

Administration approved its therapy for adults suffering from a

rare lung condition.

The blue-chip Dow sits roughly 1% away from breaking the

40,000 level for the first time.

Gains on the tech-heavy Nasdaq were capped by AI giant

Nvidia ( NVDA ) which lost 2.59% and was on track for its second

straight decline. Shares were still up more than 80% on the

year, however.

Recent data that showed hotter than expected inflation in

the form of consumer prices (CPI) and producer prices (PPI)

failed to markedly disrupt market expectations for a rate cut of

at least 25 basis points (bps) from the Federal Reserve in June.

The Fed kept its projections for three rate cuts this year

intact at its policy meeting last week, which Fed officials have

largely stood by this week in comments.

The Personal Consumption Expenditures Price Index (PCE), the

Fed's preferred inflation gauge, is due on Good Friday, when the

U.S. stock market will be closed.

"We're living in between the space of those data-heavy

bookends, and the markets are largely behaving as we would

expect them to in that void, which is we're seeing equities

largely tread water, a little bit of weakness which I would

probably chalk up more so to just quarter-end rebalancing," said

Craig Fehr, head of investment strategy at Edward Jones in St.

Louis.

"But we have the markets that are keenly anchored on the

big data points, which is inflation, Fed decisions, and the

labor market."

Later in the day, Fed Board Governor Christopher Waller is

expected to speak at the Economic Club of New York later in the

day.

The Dow Jones Industrial Average rose 307.35 points,

or 0.77%, to 39,584.13, the S&P 500 gained 23.92 points,

or 0.46%, to 5,227.50 and the Nasdaq Composite gained

35.50 points, or 0.22%, to 16,351.19.

All three major U.S. stock indexes were poised for quarterly

gains, with the S&P on track for its biggest first quarter

percentage gain since 2019.

Traders see a 70.4% chance the Fed will begin its easing

cycle in June, according to the CME FedWatch Tool.

Nine of the 11 major S&P 500 sectors were trading higher,

with rate sensitive utilities and real estate

leading the best performers as bond yields eased.

Among individual stocks, Trump Media & Technology Group ( DJT )

jumped 14.16%, a day after its stellar Nasdaq debut.

GameStop ( GME ) plunged 14.77% after the videogame retailer

reported lower fourth-quarter revenue and said it had cut an

unspecified number of jobs to reduce costs.

Advancing issues outnumbered decliners by a 3.43-to-1 ratio

on the NYSE while advancing issues outnumbered decliners by

about a 2.43-to-1 ratio on the Nasdaq.

The S&P 500 posted 43 new 52-week highs and no new lows

while the Nasdaq recorded 131 new highs and 72 new lows.