S&P 500 set for first weekly gain in eight as growth fears ebb



(For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window.)

* Dell climbs on strong Q1 results

* Gap, American Eagle Outfitters sink on cutting profit forecasts

* Indexes up: Dow 1.11%, S&P 1.76%, Nasdaq 2.51%

By Devik Jain and Anisha Sircar

May 27 (Reuters) - The S&P 500 index on Friday was set for its best weekly gain since mid-March as upbeat earnings, strength in consumer spending and signs of inflation peaking eased worries about a sharp slowdown in economic growth.

The benchmark index .SPX and the tech-heavy Nasdaq .IXIC appeared set to snap their longest weekly losing streak since the dotcom bust in 2001, up 5.8% and 6% respectively for the week.

The blue-chip Dow .DJI was on course for its best week since November 2020, up 5.6%.

The Commerce Department's report showed consumer spending increased by a more-than-expected 0.9% in April and inflation rose at a slower rate, raising hopes that the Federal Reserve might not hike rates as aggressively as previously thought.

March spending growth was also revised to 1.4% from 1.1%. The personal consumption expenditures price index, the Fed's preferred inflation gauge, gained 0.2% last month after rising 0.9% in March.

A mixed set of economic data, some optimistic retail earnings forecasts, and less hawkish minutes from the Fed's May meeting brought back investors this week.

"There is clearly a bit of wash out, a little exhaustion in the selling we are seeing. If you look at valuations, investor sentiment, and some economic indicators, there are some signs that perhaps a bottom is within reach," said Darren Chervitz, portfolio manager at Jacob Asset Management.

All of the 11 major S&P sectors advanced, with technology .SPLRCT up 2.7%, followed by a 2.4% rise in the consumer discretionary .SPLRCD sector.

Ulta Beauty ULTA.O gained 9.9% to top the S&P 500 index after the retailer forecast strong annual results. Enterprise software maker Autodesk Inc ADSK.O and PC maker Dell Technologies Inc DELL.N jumped 9.7% and 12% respectively, after they beat quarterly revenue and profit estimates.

At 12:17 p.m. ET, the Dow Jones Industrial Average .DJI was up 361.99 points, or 1.11%, at 32,999.18, the S&P 500 .SPX had advanced 71.39 points, or 1.76%, to 4,129.23, and the Nasdaq Composite .IXIC was up 294.14 points, or 2.51%, at 12,034.79.

Gap Inc GPS.N and American Eagle Outfitters AEO.N fell 0.9% and 3.8% respectively, after the clothing retailers trimmed their annual profit forecasts amid decades-high inflation.

The CBOE volatility index .VIX fell for a third straight session and was at 25.97 points.

Analysts expect trading volumes to be light ahead of a long weekend, with U.S. stock markets shut on Monday for Memorial Day holiday.

Advancing issues outnumbered decliners by a 5.96-to-1 ratio on the NYSE and by a 3.57-to-1 ratio on the Nasdaq.

The S&P index recorded three new 52-week highs and 29 new lows, while the Nasdaq posted 31 new highs and 67 new lows.
Reporting by Devik Jain and Anisha Sircar in Bengaluru; Editing by Shounak Dasgupta and Vinay Dwivedi

Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

We are using cookies to give you the best experience on our website. Read more or change your cookie settings.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.