Key inflation data continues to fall, sparking rise in stocks and Fed observation

Stocks Rise as Inflation Cools and Debate Fallout Settles

The latest reading from the Federal Reserve’s preferred inflation gauge is out, and it’s showing a promising trend of cooling inflation. This news, combined with investors digesting the aftermath of the recent Biden-Trump debate, has led to a positive day in the US stock market.

The S&P 500, Nasdaq Composite, and Dow Jones Industrial Average all saw movement in different directions, with the S&P 500 inching closer to its record high, the Nasdaq rising, and the Dow Jones slipping slightly. This week has been a rollercoaster for stocks, with ups and downs that have left investors wondering about the rest of the year.

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One key takeaway from this week is the important data point provided by the Fed’s preferred inflation gauge. Inflation eased in May, with prices increasing at their slowest pace since March 2021. The core Personal Consumption Expenditures (PCE) index, which excludes food and energy costs and is closely monitored by the Fed, rose 0.1% in May, meeting expectations.

In addition to inflation news, investors are keeping a close eye on the upcoming US election. Following President Biden’s lackluster performance in the recent debate, investors are considering the potential impact of Trump’s proposed tax cuts and trade policies on the stock market. Shares of Trump Media & Technology Group saw a significant jump in morning trading following the debate.

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However, not all news is positive. Companies like Nike and Walgreens are facing challenges, with Nike’s stock dropping more than 15% and Walgreens experiencing pressure after a significant tumble. Investors are wary of signs that consumer resilience may be weakening, especially as key companies report downbeat sales forecasts.

As we head into the second half of the year, it’s crucial for investors to stay informed and vigilant. Keep an eye on inflation trends, political developments, and company performance to make informed decisions in the ever-changing market landscape. Stay tuned to Extreme Investor Network for the latest updates and expert analysis on the finance world.