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February PCE growth slows
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S&P 500 gains for second straight quarter
(Updates to close)
By Caroline Valetkevitch
NEW YORK, March 31 (Reuters) - Wall Street rallied on
Friday and the Nasdaq notched its biggest quarterly percentage
gain since June 2020, as signs of cooling inflation bolstered
hopes the Federal Reserve might soon end its aggressive interest
rate hikes.
The S&P 500 posted a second straight quarter of gains,
led by the technology sector's more than 20% rise.
The quarterly gains came despite a sharp sell-off in bank
stocks following the collapse of two regional banks earlier this
month and worries about a bigger financial crisis.
The Commerce Department report Friday showed U.S. consumer
spending rose moderately in February while inflation cooled.
"The equity market seems to be delighted with the slight
tick lower in inflation, as it should be. It underscores that
the Fed's campaign is, in fact, working, albeit slowly," said
Quincy Krosby, chief global strategist at LPL Financial in
Charlotte, North Carolina.
The Fed has been raising rates to cool inflation, and
traders' bets of a 25-basis-point rate hike in May stood at
53.8% on Friday, according to CME Group's Fedwatch tool.
According to preliminary data, the S&P 500 gained 58.07 points, or 1.43%, to end at 4,108.76 points,
while the Nasdaq Composite gained 208.44 points, or
1.74%, to 12,221.91. The Dow Jones Industrial Average rose 408.66 points, or 1.24%, to 33,267.69.
Semiconductors were among the quarter's strongest
performing groups.
Shares of big tech gained as investors rotated out of banks
and as U.S. Treasury yields eased, with the two-year note yield
posting on Friday its largest monthly drop since 2008. Higher
yields tend to be a negative for big tech companies.
Also, Apple Inc shares rose Friday after it won its
appeal against the decision by Britain's antitrust regulator to
launch an investigation into its mobile browser and cloud gaming
services.
Boston Fed President Susan Collins said Friday that wherever
the U.S. central bank stops with its rate rises, maintaining
that level for some time will be critical in helping to lower
high inflation back to the 2% target.
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S&P 500 sectoral performance in Q1 ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
(Reporting by Caroline Valetkevitch; additional reporting by
Amruta Khandekar and Ankika Biswas; additional reporting by
Johann M Cherian Editing by Vinay Dwivedi and Maju Samuel)
