US stocks open higher after consumer inflation cools down in May

By Ovunc Kutlu

ISTANBUL (AA) - US stock exchanges opened with gains on Wednesday as consumer inflation figures for May slowed down on annual and monthly bases, and managed to come below market expectations.

The Dow Jones jumped 320 points, or 0.83%, to 39,067 at 9.36 a.m. EDT. (1336GMT). The S&P 500 rose nearly 46 points, or 0.86%, to 5,421.

The Nasdaq, meanwhile, soared 210 points, or 1.21%, to 17,554 at the time.

Consumer inflation in the US annually rose 3.3% in May, coming lower than market estimates of a 3.4% gain, after increasing 3.4% in April year-on-year, according to the Labor Department figures released earlier.

On a monthly basis, the consumer price index showed no gain and also managed to come below the market expectation of a 0.1% increase, following a monthly gain of 0.3% in April.

The positive inflation figures came just hours before the Fed concluded its two-day monetary policy meeting, in which it is widely expected to keep its federal funds rate unchanged between the 5.25% - 5.5% target range.

Investors will focus on Chair Jerome Powell's comments in the post-meeting news conference and try to get hints about when the central bank will begin cutting interest rates this year.

The VIX volatility index, also known as the fear index, plummeted 4.7% to 12.24. The 10-year US Treasury yield dove 2.9% to 4.276%.

The dollar index decreased 0.76% to 104.43, while the euro rose 0.91% to $1.0837 against the greenback.

Precious metals were on the rise, with gold adding 0.76% to $2,334 and silver increasing 2.6% to $30.04.

Oil prices were up around 1.5%, with global benchmark Brent crude at $83.16 and US benchmark West Texas Intermediate at $79.16.