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Wall Street Shakes off Inflation Rise and Closes Higher

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NEW YORK, May 28 Reuters U.S. stocks climbed on Friday as investors brushed off a strongerthanexpected inflation reading, as both the Dow and SP 500 indexes clinched their first weekly gain in the past three weeks.

Consumer prices, as measured by the personal consumption expenditures PCE price index excluding the volatile food and energy components, rose 0.7 in April, topping analysts 0.6 estimate and after a 0.4 increase in March. PCE is the Federal Reserves preferred measure of inflation.

In the 12 months through April, the core PCE price index surged 3.1, smashing through the Feds 2 target, as the reopening economy unleashed pentup demand.

Investors have been closely watching economic data and comments from Fed officials for signs of runaway inflation and the possibility the central bank may begin to pull back on its massive stimulus measures.

The data is going to remain volatile as well, the inflation data that we saw this morning with core PCE was a high print, but really not that far ahead of consensus, said Keith Buchanan, senior portfolio manager at Globalt in Atlanta.

Base effects definitely play a role, distorting the takeaways from some very large yearoveryear type of numbers, he added.

Unofficially, the Dow Jones Industrial Average rose 61.32 points, or 0.18, to 34,525.96, the SP 500 gained 2.92 points, or 0.07,…

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