Stock Market Today: Asian stocks mostly higher ahead of US inflation report

TOKYO (AP) — Asian stocks rose Friday as traders looked ahead to a key inflation report that could influence the Federal Reserve’s next move on interest rates.

Japan’s Nikkei 225 index jumped 0.9% in early trading to 39,711.93 points. In Australia, the S&P/ASX 200 index rose 0.6% to 7,803.50 points. South Korea’s Kospi rose nearly 0.3% to 2,790.97. Hong Kong’s Hang Seng added 0.8% to 17,860.79, while the Shanghai Composite Index rose 1.0% to 2,976.26.

In Japan, the government reported that the unemployment rate was unchanged from the previous month at 2.6% in May.

On Wall Street, the S&P 500 gained 0.1%. The benchmark index is hovering near an all-time high hit last week.

The Nasdaq Composite rose 0.3%, still just shy of its all-time high. The Dow Jones Industrial Average closed up 0.1%.

Gains achieved by retail and telecommunications companies helped offset losses incurred by consumer goods manufacturers, financial stocks and other companies in the market. Amazon.com shares rose by 2.2%, and Meta Platforms shares added 1.3%.

Walgreens strengthens its alliance It fell 22.2%, the biggest drop in the S&P 500. Its reported results fell short of expectations and it trimmed its outlook. The company said it could close hundreds more stores in the next three years.

Jeans maker Levi Strauss shares fell 15.4% after its latest quarterly revenue results fell short of analysts’ expectations, in addition to its current profit expectations for this year.

Shares of spice maker McCormick rose 4.3%, recording one of the largest gains in the market after it exceeded analysts’ profit expectations.

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Chipmaker Micron Technology shares fell 7.1% after its latest forecast left investors disappointed.

Treasury yields fell in the bond market. The yield on the 10-year Treasury note, which influences interest rates on mortgages and other consumer loans, fell to 4.28% from 4.33% late Wednesday. The yield on the 2-year Treasury note fell to 4.71% from 4.75%.

The stock market has been subdued this week ahead of Friday’s key inflation report from the government. The personal consumption expenditures index is the Federal Reserve’s preferred measure of inflation.

Economists expect the report to show a modest decline in inflation to 2.6% in May, after a reading of 2.7% in April. That’s below the 7.1% peak seen in mid-2022. Other inflation measures, including the consumer price index, have also fallen sharply over the past two years.

Latest inflation-related updates may affect… Central Bank Decision Speculation is increasing about when to start lowering interest rates, which remain at their highest levels in more than twenty years, and which are affecting the world. Wall Street is betting that the central bank will start cutting interest rates at its meeting in September.

An update from the government said US economic expansion At an annual rate of 1.4% from January to March. That’s a slight revision from the previous estimate of 1.3%. It’s the slowest quarterly growth since the spring of 2022.

The report also supported data from previous economic reports showing that consumers are under pressure due to persistent inflation and rising interest rates. Consumer spending, which fuels economic growth, grew at just 1.5%, down from the initial estimate of 2%, according to the report.

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“The main finding of the report is that the economy remained resilient in the first quarter, but private sector demand growth was muted, led by more consumer caution,” Gregory Daco, chief economist at EY, said in a note.

A slowdown in consumer spending could help ease inflation further, but a severe slowdown could deal a more painful blow to the economy. The Fed is trying to time its efforts to tame inflation to its 2% target without slowing the economy so much that it slides into recession.

The S&P 500 is on track for its fourth straight week of gains. With one more trading day left this month, the index is up just under 4% for June and about 15% so far this year.

Overall, the S&P 500 rose 4.97 points to 5,482.87. The Dow Jones added 36.26 points to 39,164.06. The Nasdaq Composite added 53.53 points to close at 17,858.68.

In energy trade, the price of standard US crude rose 44 cents to $82.17 per barrel. The price of global benchmark Brent crude rose 39 cents to $86.78 per barrel.

In currency trading, the US dollar rose to 160.96 Japanese yen from 160.72 yen. The euro fell to $1.0695 from $1.0709.

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Associated Press business writers Damien J. Trois and Alex Vega contributed to this report.

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