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Traders work on the floor of the New York Stock Exchange.
Lucas Jackson | Reuters
U.S. stock futures rose Thursday, buoyed by inflation data that increased hopes the Federal Reserve could begin cutting rates next year. Wall Street was also poised to wrap up November with strong monthly gains.
Futures tied to the Dow Jones Industrial Average were up 229 points, or nearly 0.7%. S&P 500 and Nasdaq-100 futures each climbed about 0.3%.
Salesforce and Snowflake popped 9% and 7.8%, respectively, on the back of better-than-expected earnings. Sentiment also got a boost Thursday after new data out of Europe showed inflationary pressures are easing.
Data released early Thursday showed that the personal consumption expenditures price index—the Federal Reserve’s favorite inflation gauge—rose in line with expectations in October, gaining 0.2% for the month and 3.5% on a year-over-year basis. The numbers could provide a strong incentive for the Fed to hold rates steady, before lowering them in 2024.
Although the 30-stock Dow and the S&P 500 ended Wednesday’s trading session near the flatline, the two indexes are only about 0.5% and 0.8%, respectively, from their year-to-date closing highs. The tech-heavy Nasdaq Composite slipped 0.16% during the day, but is also roughly 0.7% away from its 2023 closing high.
The major averages remain on track to close November with sizeable gains, which would end a three-month losing streak for the indexes. The S&P 500 is up 8.5% in November, while the Nasdaq has advanced nearly 11%. Both averages are tracking for their best monthly performance since July 2022. The Dow is up 7.2% in November, on pace for its best month since October 2022.
Despite interest rates lingering at higher levels, strategist Jay Woods isn’t afraid that stocks will give up their gains before the year’s end.
“The cycle, to me, is complete. We’ve made back what we lost, and now we’re starting to build on where we were going at the end of 2021 when the market was hot,” the chief global strategist at Freedom Capital Markets told CNBC. “The price action is positive. The economic data supporting the Fed to continue to keep rates at bay and possibly decrease is a huge tailwind.”
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