US stocks were higher after a volatile start for the technology-weighted Nasdaq benchmark as traders assessed the impact of higher-than-expected producer prices on the Federal Reserve's upcoming rate decision and as oil futures prices fluctuated after disruption at a key gas pipeline in Europe.
Seasonally adjusted producer prices index (PPI) for final demand rose by 0.4% in November, matching levels seen in October and September but ahead of economists' expectations for a rise of 0.3%, according to data published by the Bureau of Labor Statistics. The measure - often seen as an indication of industrial inflation - comes as the Federal Reserve commences its two-day December policy meeting.
While the central bank is widely expected to raise interest rates on Wednesday, the latest PPI reading, and core consumer price index ( CPI ) data which is due out also on Wednesday, could influence the number of rate hikes implemented by the Fed next year. Exchange operator CME Group is currently placing the odds of a 25 basis points rate hike this month at 87.6%; if the benchmark rate is raised it would signal continued confidence in the health of the US economy despite lackluster growth in the CPI.
In stocks news, nine of the 10 S&P 500 Index sectors were up at the time of writing, with telecoms, real estate and financials leading the gainers while utilities dragged. The Nasdaq, which flip-flopped between positive and negative territory earlier in the morning was trading higher and the Dow Jones Industrial Average was steadily advancing, helped by a jump in Boeing's ( BA ) shares, up 2.5% one day after the aircraft manufacturer said it would ramp up its quarterly dividend and replace its existing share repurchase scheme with a new $18 billion authorization.
Oil futures prices were ricocheting between gains and losses after Brent crude, the international gauge, briefly traded at $65.83 per barrel, a level last surpassed in June 2015, after an explosion at a gas pipeline hub in Austria raising concern about supply in the region. Brent crude was trading 0.03% higher at $64.70 per barrel recently while West Texas Intermediate crude oil, the US benchmark, was down by 0.3% at $57.84 per barrel.
The Dow Jones Industrial Average was 0.56% higher, the S&P 500 Index was up by 0.29% and the Nasdaq was 0.13% higher at the time of writing.
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