By Lawrence Delevingne and Naomi Rovnick
(Reuters) -Global shares were mixed and benchmark Treasury yields were steady on Friday as stock indexes rose on data showing U.S. inflation rose largely in line with expectations and a rally in technology shares.
Monthly underlying inflation picked up last month, largely driven by housing costs, a U.S. Commerce Department report on Friday showed. With spending seen cooling off in early 2024 as savings accumulated during the COVID-19 pandemic run out, most economists believe the Federal Reserve is done raising interest rates, though risks of a rate hike remain.
"Core inflation continues to lose speed," Jeffrey Roach, chief economist for LPL Financial in Charlotte, North Carolina, said in an email. "This report will not likely change the Fed's view that inflation will slow in the coming months as demand slows."
The Dow Jones Industrial Average fell 0.16%, to 32,732, the S&P 500 gained 0.35%, to 4,151 and the Nasdaq Composite added 1.16%, to 12,741.
Shares of internet retail giant Amazon.com advanced 8% after beating sales estimates, while Intel Corp jumped 9% after the chipmaker signaled personal computer market rebounding from a quarters-long slump.
MSCI's all-country equity gauge rose 0.45% following reassuring news on Thursday that the U.S. economy expanded at its fastest rate for almost two years in the third quarter, while the European Central Bank (ECB) also held interest rates steady.
Europe's Stoxx 600 share index was 0.9% lower and MSCI's broadest index of Asia-Pacific shares outside Japan closed 1.1% higher after hitting a fresh 11-month low on Thursday.
SOFT LANDING?
The yield on the 10-year U.S. Treasury, which moves inversely to the price of the debt security and functions as a benchmark for global borrowing costs, was little changed at 4.862% after crossing 5% earlier in the week.
Bank of America strategists said that despite unexpectedly strong U.S. economic growth in the third quarter, a slowdown in the fourth quarter still made "a soft landing more likely than no landing."
Globally, "markets continue to hope for disinflation to continue smoothly, but don't take disinflation for granted," they wrote in a note on Friday.
The Fed is widely expected to keep its funds rate in a range of 5.25%-5.5% next week, although Chair Jay Powell has said a strong economy and tight jobs market could warrant more rate rises.
The ECB on Thursday also held its deposit rate at a record high of 4%, although President Christine Lagarde signaled in comments after the decision that further monetary tightening was possible.
Oil prices rose as investors priced in fears of an escalation of conflict in the Middle East which could disrupt oil supplies.
U.S. crude was last up 0.87% at $83.93 per barrel and Brent was at $88.75, up 0.93% on the day.
CURRENCY MOVES
In currency markets, the euro was steady at 1.059 per dollar, now down almost 14% in the last three months.
Thanks to rate rises and a robust U.S. economy, the index that measures the dollar's strength against competing currencies has risen almost 5% in three months and was on track for a weekly gain, even as it ticked down slightly on the day.
The yen hit a new one-year low of 150.77 per dollar overnight and was last at 149.61. That put it not far off the three-decade low of 151.94 it touched in October last year that led Japanese authorities to intervene to prop up the currency.
(Reporting by Lawrence Delevingne in Boston, Naomi Rovnick in London and Stella Qiu in SydneyEditing by Jamie Freed, Mark Potter, David Evans and Richard Chang)
