The S&P 500 index rose 1.9% last week to a new closing high as September consumer price data came in softer than expected while companies including Intel (INTC) and International Business Machines (IBM) surpassed earnings expectations.
The week’s gain brought the S&P 500 into positive territory for the month. It’s now up 1.5% for October and 15% for the year.
Data released on Friday showed U.S. consumer prices rose less than expected in September, while core inflation surprisingly ticked down, reinforcing expectations for another interest rate cut next week.
The report, which had been delayed by the ongoing government shutdown, showed the consumer price index rose 0.3% month on month in September, slower than August’s 0.4% climb and lower than the Bloomberg-polled consensus estimate for a 0.4% increase. Annually, inflation accelerated to 3% from August’s 2.9%, but was below Wall Street’s 3.1% estimate.
Core inflation, which excludes the volatile food and energy components, slowed to 0.2% from 0.3% in August. The annual core measure eased to 3% from 3.1%. The market expected both measures to remain unchanged.
The technology sector led the week’s gains, climbing nearly 2.8%, followed by a 2.4% rise in energy and a 2.1% increase in industrials. Consumer discretionary and health care rose 1.9% each. Financials, real estate and communication services also added at least 1% each while materials edged up 0.6%.
International Business Machines (IBM) was among the top gainers in technology, climbing 9.3% as the company lifted its full-year revenue growth outlook and reported better-than-expected third-quarter results. Revenue is now anticipated to rise by more than 5% in constant currency terms for 2025, the computer and software company said, compared with its previous projections for growth of at least 5%.
Intel’s (INTC) shares also gave the tech sector a lift, rising 3.4%. The chipmaker reported it turned a profit in the third quarter as revenue unexpectedly rose, thanks to artificial intelligence boosting demand for computing power.
Not all sectors rose… Consumer staples shed 0.6% and utilities edged down 0.2%.
This week’s earnings schedule features a number of large companies including Visa, UnitedHealth Group, Microsoft, Alphabet, Meta Platforms, Apple, Amazon.com, Eli Lilly, and Mastercard, among others.
Economic data may be light if the U.S. government shutdown continues. The shutdown has caused a delay in closely watched government data releases including the September jobs report.
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