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PCE data shows inflation rose 2.5% in July
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Marvell ( MRVL ) jumps after forecasting Q3 results above estimates
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Ulta Beauty ( ULTA ) tumbles following annual forecast trim
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Dell gains after raising annual results forecast
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Futures up: Dow 0.19%, S&P 500 0.45%, Nasdaq 0.84%
(Updated at 08:43 a.m. ET/ 1243 GMT)
By Johann M Cherian and Purvi Agarwal
Aug 30 (Reuters) -
Wall Street's main indexes were set for a higher start on
Friday after a key inflation report reiterated that price
pressures were moderating, cementing bets for an interest-rate
cut at the Federal Reserve's upcoming meeting in September.
The Personal Consumption Expenditure index, the central
bank's preferred inflation measure, rose 2.5% in July on an
annual basis compared to an estimate of 2.6%, according to
economists polled by Reuters. On a monthly basis, it rose 0.2%
as expected.
Among rate-sensitive megacaps, Alphabet and
Meta gained 0.8% and 0.6%, respectively, while Tesla
added 1.2% in premarket trading.
Friday's PCE report is the last before the Federal
Reserve's September meeting and follows Fed Chair Jerome
Powell's comments last week expressing support for an imminent
policy adjustment.
"Powell's speech at Jackson Hole reiterated several times
that we're approaching our desired target. Nothing here is going
to cause me to change anything," said Andre Bakhos, managing
member at Ingenium Analytics.
"I would vote 25 bps because it's been going in the
direction the Fed has been targeting and the market has factored
all of this in."
Odds of a 25-basis-point reduction stood at 69.5%,
according to the CME Group's FedWatch Tool, while those of a
50-bps reduction are at 30.5%.
Global markets are nearing the end of a tumultuous month for
riskier assets, after signs of a sudden moderation in the labor
market sparked fears of a quicker-than-expected slowdown in the
world's largest economy in early August. The influence of the
Japanese yen carry trade worsened the rout.
Risk-taking has improved since then, with the Dow at
a record high and on track for monthly gains as subsequent data,
including Thursday's upward revision to economic growth, soothed
investor nerves.
At 08:43 a.m., Dow E-minis were up 79 points, or
0.19%, S&P 500 E-minis were up 25.25 points, or 0.45%,
Nasdaq 100 E-minis were up 162.5 points, or 0.84%.
The tech-focused Nasdaq and the S&P 500
closed lower in the previous session after Nvidia ( NVDA )
failed to match investors' sky-high expectations despite upbeat
results and a broadly in-line forecast. The AI-chip bellwether
was up 0.9% after a 6.4% drop in the previous session.
The benchmark S&P 500 is close to an all-time high, poised
for a monthly gain of 1.2%, while the Nasdaq is down 0.47% in
August.
Marvell Technology ( MRVL ) forecast third-quarter results
above Street estimates, sending the chipmaker's shares up 11.2%.
Dell Technologies ( DELL ) advanced 4.87% after lifting its
annual revenue and profit forecasts, buoyed by demand for its
AI-optimized servers.
Lululemon Athletica ( LULU ) gained 3.86% after posting a
beat on second-quarter profit, while Ulta Beauty ( ULTA ) slid
6.2% after it trimmed its annual results forecasts due to
slowing demand.
Investors will also parse the University of Michigan's final
reading on consumer sentiment for August later in the day.
Trading volumes are expected to thin ahead of the extended
weekend due to the Labor Day holiday.