The Nasdaq Composite rose 0.2% to 23,555.1, with the S&P 500 up 0.2% to 6,868.2 and the Dow Jones Industrial Average 0.1% higher at 47,908.5, with all three gauges trading close to all-time highs. Except for utilities and healthcare, all sectors rose intraday. Communication services led the gainers in a broad-based rally.
The growth in the core price consumption expenditures, or PCE, price index slowed to 2.8% year-over-year in September, from 2.9% in the previous month, according to the Bureau of Economic Analysis' delayed report released on Friday. The month-over-month rate increased by 0.2%, as expected, and followed a 0.2% gain in August. Core PCE, the Fed's primary inflation-gauging tool, excludes the more volatile food and energy.
The headline PCE price index grew by 0.3% in September, as expected, lifting the year-over-year rate to 2.8% from 2.7%. The price index rose 0.3% month-over-month in August.
The University of Michigan's preliminary consumer sentiment index rose to 53.3 in December from 51.0 in November, above expectations for 52.0 in a survey compiled by Bloomberg. Respondents pegged one-year inflation expectations at 4.1%, down from 4.5% in November, while five-year inflation expectations fell to 3.2% from 3.4%.
Gold futures rose 0.6% to $4,269.22, and silver futures jumped 2.9% to $59.13.
Both the inflation forecasts fell to the lowest levels since January 2025, "as tariff-related pressure faded somewhat," Jefferies Chief US Economist Thomas Simons said in a note. The current probability of the Fed cutting rates by 25 basis points on Dec. 10 stood at 87%, versus 88% on Thursday, according to the CME FedWatch tool.
Most US Treasury yields rose, with the two-year yield up 1.7 basis points to 3.55%. The 10-year yield climbed 1.2 basis points to 4.12%.
The yield on 10-year Japanese government bonds, regarded as the country's benchmark long-term interest rate, rose to 1.95% on Friday, the highest since July 2007. Higher Japanese yields mean a narrower spread with US Treasuries, reducing the appeal of yen-funded carry trades that have been soaking up US government debt.
In company news, Netflix (NFLX) has agreed to acquire Warner Bros. Discovery (WBD) for an equity value of $72 billion in a cash-and-stock deal that the companies said would strengthen the entertainment industry. Warner Bros. shares jumped 3.5%.
Shares of Ulta Beauty (ULTA) surged 14%, the top gainer on the S&P 500, as the beauty retailer reported better-than-expected fiscal Q3 sales.
The worst performer on the index was W. R. Berkley (WRB), with shares down 7.5%. The company disclosed Friday it has been informed that Mitsui Sumitomo Insurance has acquired at least a 12.5% stake in W. R. Berkley as part of previously announced agreements with the Berkley family.
In energy markets, West Texas Intermediate crude oil futures rose 0.8% to $60.15 a barrel.
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