US futures rise as the Fed’s favored PCE inflation print hits the mark

US stocks rose at the opening bell on Friday, poised to end a shaky week on a high note as the latest reading of the Federal Reserve’s preferred inflation gauge bolstered hopes for a rate cut.

The Dow Jones Industrial Average (^DJI) gained 0.5 percent, hovering around Thursday’s record close, its third this week. The S&P 500 (^GSPC) rose about 0.2% and the Nasdaq Composite (^IXIC) rose 0.8%.

Stocks are taking on an upbeat tone at the end of the month, with recession fears and the disappointment of early August in the rearview mirror and a long-awaited start to Fed easing just ahead.

Wall Street welcomed the update to the personal consumption expenditure index, which showed prices rose in line with expectations for July. “Core” inflation – which excludes food and energy prices – rose 0.2% month-on-month, as expected. The annual rate came in at 2.6%, equaling June’s level and below the 2.7% forecast.

PCE inflation levels are closely watched by the Fed and in turn are watched closely by investors to gauge the size and pace of interest rate cuts this year. After Chairman Jerome Powell made it clear last week that a pivot could be expected in September, bets on a 0.5 percent cut multiplied amid signs of strength in the economy. The steady level of July price pressures kept a 0.25% move lower in play.

Meanwhile, investors are shifting away from monitoring Nvidia’s ( NVDA ) earnings, which have kept markets in check this week. The S&P 500 and Nasdaq Composite are on track for weekly losses after choppy trading action as technicians struggled.

Chipmaker Intel ( INTC ) is considering spinning off its foundry and other options as rival Nvidia tries to limit losses. Its shares gained 6% in morning trading.

Elsewhere in tech, shares of Dell ( DELL ) rose 5% after the hardware maker raised its annual profit and revenue forecasts on demand for its Nvidia-powered AI servers.