Asian stocks shrug off Wall Street's latest rout as Chinese factory activity weakens.

NEW YORK (AP) U.S. stocks are up slightly after the latest inflation figures came in about as expected, leaving open the question of when Wall Street will get the lower interest rates it craves . The S&P 500 was up 0.2% Friday morning, although it was still on track for its first losing week in the last six weeks. The Dow Jones Industrial Average rose 75 points and the Nasdaq composite rose 0.1%. The gap jumped after delivering better than expected results. Treasury yields eased in the bond market after inflation numbers came out as expected. That pared gains in yields earlier in the week, hurting stocks.

THIS IS A LATEST UPDATE. AP's earlier story follows below.

Wall Street quickly moved from losses to gains early Friday after government data showed inflation had eased for the first time this year.

S&P 500 futures were up 0.3% before the bell, while Dow Jones Industrial Average futures were up about 0.2%.

Markets cheered after the Fed's preferred inflation measure showed prices cooled slightly last month, to a year-over-year gain of 2.8%, the same as in March.

That same indicator accelerated in the first three months of 2024, disrupting what had been a steady decline and ending any notion that the Fed would begin cutting rates early this year.

The U.S. central bank began raising rates in March 2022 in an effort to extinguish four-decade high inflation that came as the economy rebounded from the COVID-19 recession in 2020.

With inflation remaining stubbornly above the Fed's 2% target level, Wall Street traders now expect just one rate cut this year. And that's far from certain, with investors estimating the likelihood of a decline in November at 63%, up from 77% last week.

In early trading Friday, fashion retailer Gap Inc. jumped more than 25% after reporting nearly triple the earnings per share Wall Street expected.

Ulta Beauty, the cosmetics retailer, also reported strong first-quarter earnings, sending its shares up 10% before the bell.

On the losing side was computer and server maker Dell, which saw its shares fall nearly 17% before markets opened, even as its sales and profits exceeded Wall Street targets. Some analysts have suggested that sales of the Texas-based company's servers aimed at the artificial intelligence market have disappointed investors, who had extremely high expectations due to the recent frenzy around AI.

Generally speaking, the three major U.S. indexes, the S&P 500, the Dow and the Nasdaq, are on track to end May with gains after April's wipeout. With earnings season unofficially ending this week, investors and analysts will be focusing on economic data while trying to guess if and when the Fed could potentially cut rates.

In Europe, at midday, London's FTSE 100 gained 0.4%, while Paris' CAC 40 and Germany's DAX were virtually unchanged.

In Asian trading, Tokyo's Nikkei 225 gained 1.1% to 38,487.90 as news circulated of major investment plans from government-backed pension funds and other big investors institutional.

Semiconductor maker Tokyo Electron lost 2.5%.

Financial newspaper Nikkei said Japan was preparing to inject nearly 100 trillion yen ($638 billion) of additional public money into markets, similar to the government's Pension Investment Fund.

Chinese stocks lost ground late in the day following an official investigation Chinese factory activity weakens in May on slowing export orders, putting additional pressure on an economy already weighed down by a prolonged crisis in the real estate sector.

Hong Kong's Hang Seng index fell 0.8% to 18,079.61 and the Shanghai Composite index lost 0.2% to 3,081.81.

Australia's S&P/ASX 200 rose 1% to 7,701.70 and Seoul's Kospi was flat at 2,6536.52.

Taiwan's Taiex fell 0.9% as shares of the market's biggest heavyweight, computer chip maker Taiwan Semiconductor Manufacturing Corp., fell 2%, tracking declines in other big technology companies.

In the bond market, the 10-year Treasury yield fell to 4.52% early Friday from 4.55% Thursday evening, while the 2-year yield fell to 4.91% from 4.93% Thursday evening .

Benchmark U.S. crude oil rose 16 cents to $78.07 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, gained 31 cents to $82.19 a barrel.

The US dollar fell from 156.82 Japanese yen to 157.16 Japanese yen. The euro rose from $1.0834 to $1.0853.

Nvidia's 3.8% decline on Thursday helped push the Nasdaq Composite Index down 1.1%, while the S&P 500 fell 0.6%, even though the majority of stocks on the index and Wall Street were up. The Dow Jones fell 0.9%.