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US producer prices rise less than expected in July

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Starbucks ( SBUX ) up after naming Chipotle boss Brian Niccol as

CEO

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BuzzFeed ( BZFD ) jumps on smaller second-quarter loss

(Updated as of 4 p.m. ET)

By Abigail Summerville

Aug 13 (Reuters) - U.S. indexes closed higher on Tuesday

and hit a near two-week high after softer producer prices data

reinforced bets of an interest-rate cut by the Federal Reserve

in September.

U.S. producer prices increased less than expected in July as

a rise in the cost of goods was tempered by cheaper services,

indicating that inflation continued to moderate. In the 12

months through July, the PPI increased 2.2% after climbing 2.7%

in June.

Investors now await all-important consumer-price figures for

July on Wednesday and retail sales data on Thursday to firm bets

on an aggressive rate cut by the U.S. central bank.

"The core PPI number furthers the narrative that the Fed has

done an excellent job of keeping inflation relatively under

control and that the more likely move is going to be a rate cut

sooner rather than later," said Michael James, managing director

of equity trading at Wedbush Securities.

"You have the CPI print tomorrow morning. Any data point is

going to have an outsized influence on the market because people

are so jittery right now."

Traders now see a 55% chance of a 50-basis-point rate cut by

the U.S. central bank, from less than 50% before the report,

according to CME's FedWatch Tool.

Stocks wobbled on Monday with the S&P 500 nearly flat

and the Nasdaq eking out modest gains, following a

turbulent week marked by mixed economic reports and a rate hike

by Japan's central bank.

According to preliminary data, the S&P 500

gained 90.16 points, or 1.69%, to end at 5,434.55 points,

while the Nasdaq Composite gained 405.84 points, or

2.42%, to 17,186.44. The Dow Jones Industrial Average

rose 405.42 points, or 1.03%, to 39,762.43.

Starbucks ( SBUX ) was the top performer on the S&P 500, and

was on track for its biggest one-day percentage gain ever, after

the coffee giant appointed Chipotle Mexican Grill's ( CMG ) head

Brian Niccol as chairman and CEO.

Meanwhile, Chipotle shares fell.

Home Depot ( HD ) reversed losses and climbed slightly. The

home-improvement chain forecast a decline in annual profit and a

bigger drop in its annual comparable sales.

BuzzFeed ( BZFD ) jumped after the digital media company

narrowed its net loss in the second quarter to $6.6 million from

$22.5 million a year earlier.