Investing.com — Wall Street Trading Higher

Wall Street is seen trading higher Friday ahead of the Fed’s preferred inflation gauge. Intel is looking at restructuring options, while Dell impressed with its quarterly results and forecasts.

1. PCE Price Index Looms Large

The main focus for investors remains on the pace and scale of Fed rate cuts this year, with more key inflation data due for release later in the session.

The Personal Consumption Expenditures price index, the Federal Reserve’s preferred inflation yardstick, is expected to show inflation picked up slightly in July.

The index is expected to rise by 0.2% in July, an annual gain of 2.6%, slightly above the previous month’s 2.5%.

Fed Chair Jerome Powell acknowledged recent progress on inflation at the Fed’s Jackson Hole symposium last week, stating that “the time has come for policy to adjust.”

Markets have interpreted this as nearly guaranteeing a rate cut next month, marking the first such cut in over four years. However, a relatively strong economy and persistent inflation may limit sharp rate cuts.

2. Futures Rise Ahead of PCE Data

U.S. stock futures rose Friday, ending a volatile week positively ahead of a key inflation report.

By 04:00 ET (08:00 GMT), Dow futures were 85 points, or 0.2%, higher, S&P 500 futures climbed 25 points, or 0.5%, and Nasdaq 100 futures rose by 145 points, or 0.8%.

Attention is on the release of the Federal Reserve’s favorite inflation gauge ahead of its September policy meeting.

By the last trading day of August, the S&P 500 index was on pace for a 1.3% gain for the month, while the Dow Jones was set to add 1.2%. The Nasdaq Composite is down nearly 0.5% this month.

Dell is expected to gain about 3% premarket after raising its forecasts.

Conversely, Ulta Beauty’s stock dropped roughly 7% in extended trading after cutting its annual sales and profit forecasts due to slowed demand. Lululemon’s stock gained 4% premarket on better-than-expected earnings despite also lowering forecasts.

3. Intel Discusses Restructuring Options

Intel is considering splitting off its foundry business and possibly scrapping plans for new factories amid a slowdown. The chipmaker is in discussions with investment bankers over potential options.

Once a leading chipmaker, Intel faces increased competition from Advanced Micro Devices and Nvidia, as well as Taiwan’s TSMC. Recently, Intel suspended its dividend and reduced its workforce by about 15%.

Reports indicate Intel is exploring separating its product design and foundry business and may abandon expansion plans.

4. Dell Raises Annual Forecasts

Dell Technologies raised its annual revenue and profit forecasts due to rising demand for its AI-optimized servers, leading to a roughly 3% increase in premarket shares.

The company now anticipates annual revenue between $95.5 billion and $98.5 billion, up from $93.5 billion to $97.5 billion previously. It also adjusted its annual profit per share forecast to $7.80.

Demand for AI-optimized servers rose 23% to $3.2 billion in Q2, with overall revenue for the quarter increasing 9% to $25.03 billion, surpassing expectations.

5. Crude Helped by Libya Supply Concerns

Crude prices rose Friday amid ongoing supply concerns in Libya, although weak demand limited gains.

By 04:00 ET, U.S. crude futures gained 0.6% to $76.33 a barrel, while Brent rose 0.6% to $79.32 a barrel.

Both benchmarks are poised for over 1% gains but have declined roughly 2% in August—the second consecutive monthly drop—amid fears of slowing growth in the U.S. and China affecting demand. Weak economic data from China continues to raise concerns about a slowdown in oil demand, particularly as the summer travel season ends.