Inflation Report Has Little Impact

Stocks held on to modest gains Friday on Wall Street, ending the week higher for the first time in three weeks. The S&P 500 rose 3.23 points to 4,204.11, the Dow climbed 64.81 points to 34,529.45, and the Nasdaq was up 12.46 points to 13,748.74, per the AP. Investors seemed to take in stride a report showing that a closely watched measure of inflation came in somewhat hotter than expected last month. The Commerce Department reported that personal consumption expenditures, a measure of inflation used by the Federal Reserve, rose by 3.6% in April. Excluding volatile food and energy prices, inflation was still high at 3.1%, and well above the Federal Reserve's long-term target of inflation of around 2%.

Inflation data is being closely watched partly to help with decisions about easing measures taken to help the markets recover during the pandemic, per the Wall Street Journal. "We don't think the Fed's going to raise rates aggressively. We think they’ll remain behind the curve because they want to help the economy recover," said Paul Flood, investment manager at Newton Investment Management. "Everybody is expecting inflation in the short term." The biggest gain in the S&P 500 for the day was for Salesforce.com, which climbed 5.4% after reporting solid results for its latest quarter. On Monday, US markets will be closed for Memorial Day.

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