Focus on inflation data and Fed decision drives Wall St climb

Summary

CompaniesFed expected to hold rates this week

Consumer prices data for May due on Tuesday

Nasdaq Inc slides on Adenza buyout deal

Indexes up: Dow 0.21%, S&P 0.36%, Nasdaq 0.71%

June 12 (Reuters) – Wall Street’s main indexes rose on Monday, extending a recent rally, as investors awaited inflation data and the Federal Reserve’s interest rate decision this week, while Oracle hit a record high ahead of quarterly results later in the day.

The U.S. Labor Department’s consumer price index reading on Tuesday, first day of the Fed’s two-day meeting, is expected to show inflation cooled slightly in May but core prices likely remained sticky.

Traders see a 76% chance of the central bank holding rates at the 5%-5.25% range on Wednesday, while pricing in a 56% chance of a 25-basis-point increase in July, according to the CME Fedwatch tool.

“I expect this Fed meeting to be in line with market expectations, which is a pause and re-evaluation for the future that could change based on CPI data tomorrow,” said Dylan Kremer, co-chief investment officer of Certuity.

“There’s a chance that the Fed will stay data dependent. So we don’t necessarily think that a rate hike is off the table in the future, but for the near term we just see them staying steady.”

The benchmark S&P 500 (.SPX) notched gains for a fourth straight week on Friday, building on a 20% rise from its October 2022 lows, heralding the start of a new bull market as defined by some market participants.

A rally in megacap stocks, better-than-expected quarterly earnings and hopes that the Fed might be nearing the end of its monetary tightening cycle have lifted indexes in recent weeks.

Since last week, the rally has broadened to include more economically sensitive sectors such as energy and industrials, as well as small-cap stocks as data continues to show a resilient U.S. economy despite higher interest rates.

Goldman Sachs on Friday raised its year-end price target for the benchmark S&P 500 (.SPX) to 4,500 from 4,000, citing the broadening of the market rally.

The CBOE volatility index (.VIX) edged up after hitting pre-pandemic levels in the previous week, up 0.68 point at 14.51.

Oracle (ORCL.N) advanced 6.4% to hit an all-time high as J.P. Morgan hiked its price target to $109, ahead of the cloud and enterprise software firm’s fourth-quarter results later in the day.

Technology (.SPLRCT) and consumer discretionary stocks (.SPLRCD) led gains among the 11 major sectors of the S&P 500, while energy stocks (.SPNY) fell 1.2%, tracking a decline in crude prices.

At 12:13 p.m. ET, the Dow Jones Industrial Average (.DJI) was up 71.54 points, or 0.21%, at 33,948.32, the S&P 500 (.SPX) was up 15.50 points, or 0.36%, at 4,314.36, and the Nasdaq Composite (.IXIC) was up 94.23 points, or 0.71%, at 13,353.37.

Nasdaq Inc (NDAQ.O) slumped 13.5% after the exchange operator said it would buy software firm Adenza for $10.5 billion, which analysts called an expensive bet.

Biogen (BIIB.O) shares edged up 1.6% after a U.S. FDA panel…

Link from www.reuters.com