© Reuters.
By Liz Moyer
Investing.com -- U.S. stocks were rising after inflation data met expectations, fueling hopes for a smaller interest rate increase by the Federal Reserve next week.
At 10:42 ET (14:42 GMT), the Dow Jones Industrial Average rose 434 points or 1.4%, while the S&P 500 rose 1.9% and the NASDAQ Composite rose 2.2%.
The Bureau of Labor Statistics reported a 0.4% rise in the consumer price index in February from the previous month, cooling slightly from January’s reading. On an annual basis, inflation rose 6%, also cooling from the prior reading. Core prices, which exclude food and fuel, rose 0.5% from the prior month, slightly more than expected.
Most futures traders are expecting a quarter of a point rate hike next week, though 15% of traders are betting on the Fed to pause rate hikes, according to CME’s FedWatch tool. Just last week, expectations were running high for a half-point rate hike.
Also fueling hopes for a less aggressive Fed: the collapse of Silicon Valley Bank over the weekend, which has rippled through bank stocks on fears of a wider contagion. Regulators have stepped in to backstop depositors of SVB and Signature Bank, which also shut down.
Shares of large regional banks sank on Monday but were rebounding on Tuesday. KeyCorp (NYSE:KEY) was up 15% in early trading. Comerica Inc (NYSE:CMA) was up 11%, while PacWest Bancorp (NASDAQ:PACW) was up 52%. First Republic Bank (NYSE:FRC) was up 57%.
Meta Platforms Inc (NASDAQ:META) is cutting another 10,000 workers, incurring charges of as much as $5 billion, and warned about the possibility of economic uncertainty sticking around. Shares rose 5%.
A California appeals court ruled companies can treat workers as independent contractors, boosting shares of ride-sharing apps Uber Technologies (NYSE:UBER) and Lyft (NASDAQ:LYFT), and delivery service DoorDash (NYSE:DASH).
Oil fell. Crude Oil WTI Futures were down 1.4% to $73.77 a barrel, while Brent Oil Futures were down 1.1% to $79.88 a barrel and Gold Futures were down 0.3% to $1909.
