NEW YORK: Wall Street stocks rose early Wednesday as investors weighed the latest US economic figures showing an uptick in inflation – boosted by gasoline costs.
Consumer inflation accelerated to 3.7 percent in August, up from 3.2 percent in July, according to the Labor Department.
This was driven up by higher gasoline prices, but the “core” reading that strips out volatile food and energy costs cooled from 4.7 percent in July to 4.3 percent in August on an annual basis.
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The lower “core” number gives hope that Federal Reserve policymakers can hold off further interest rate hikes for now as its earlier increases impact the economy.
Shortly after trading began, the Dow Jones Industrial Average was up 0.1 percent at 34,694.98.
The broad-based S&P 500 rose 0.2 percent to 4,471.37, while the tech-rich Nasdaq Composite Index climbed by 0.3 percent to 13,817.80.
While core inflation picked up slightly on a month-on-month basis, marking a setback, “that was due to the rise in mostly in fuel prices,” said Peter Cardillo of Spartan Capital.
“The key is that the inflation overall trend remains lower,” he added.
This probably will not change expectations for the US central bank to hold interest rates where they are following their meeting next week, he said.
Among individual companies, shares in American Airlines and Spirit Airlines slipped as they warned of higher costs that could bog down profits.
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