U.S. stocks rose before the bell on Friday, looking to end a volatile week on a higher note as investors eager for interest rate cuts awaited a key reading of the Federal Reserve’s preferred inflation gauge.
Dow Jones Industrial Average futures rose about 0.2%, holding onto their record close from Thursday, their third this week. S&P 500 futures rose about 0.4%, and tech-heavy Nasdaq 100 futures jumped 0.6%.
Stock markets are on a positive note as the market stabilizes at the end of the month, recession fears and the sharp drop in early August recede, and the Federal Reserve begins to ease monetary policy after a long wait.
All eyes will be on Friday’s reading on the personal consumption expenditures index, which investors are watching for clues about the path of US interest rates this year. Although Federal Reserve Chairman Jerome Powell has made clear that the bank is ready to cut interest rates, any surprise could shake the market.
Hopes have risen that policymakers will cut interest rates by 0.5% in September as fears of recession fade, with Thursday’s GDP review the latest sign of economic strength. Any sign that inflation is not cooling as much as it should is seen as increasing the odds of a smaller 0.25% cut.
The personal consumption expenditures report is expected to show “core” inflation — which excludes food and energy prices — rose to 2.7% in July. The report is due at 8:30 a.m. ET on Friday.
Meanwhile, investors are turning away from Nvidia (NVDA) earnings that have kept markets in check this week. The S&P 500 (^GSPC) and Nasdaq Composite (^IXIC) are headed for weekly losses after volatile trading as tech companies struggle.
Chipmaker Intel Corp. (INTC) is considering spinning off its factory and other options as rival Nvidia Corp. tries to limit losses. Its shares rose 3% in premarket trading.
Elsewhere in the tech sector, shares of Dell (DELL) rose after the hardware maker raised its annual earnings and revenue forecasts, thanks to demand for Nvidia-powered AI servers.