Stock market today: Wall Street advances before the inflation report

Wall Street's major stock indexes closed little changed Thursday as traders eagerly awaited a key inflation report that could influence the Federal Reserve's next interest rate decision.

The S&P 500 gained 0.1%. The benchmark index is near the all-time high it hit last week.

The Nasdaq Composite Index rose 0.3% and remains just below its all-time high. The Dow Jones Industrial Average closed up 0.1%.

Gains by retailers and communications services companies helped offset losses by consumer goods makers, financial stocks and other market participants. Amazon.com rose 2.2% and Meta Platforms added 1.3%.

Walgreens Boosts Alliance fell 22.2%, the biggest decline in the S&P 500. The company reported weaker-than-expected results and lowered its outlook. The company said it could close hundreds more stores over the next three years.

Jeans maker Levi Strauss fell 15.4% after its latest quarterly revenue results fell short of analysts' expectations, as did its current profit forecast for the year.

Spice maker McCormick rose 4.3%, one of the market's biggest gains after beating analysts' profit forecasts.

Chipmaker Micron Technology fell 7.1% after its latest forecast disappointed investors.

Treasury yields fell in the bond market. The yield on 10-year Treasury notes, which influence interest rates on mortgages and other consumer loans, fell to 4.28% from 4.33% late Wednesday. The yield on two-year Treasury notes fell to 4.71% from 4.75%.

A government update says the U.S. economy grew at an annual rate of 1.4% from January to March. This figure is a slight revision from a previous estimate of 1.3%. This is the slowest quarterly growth since spring 2022.

The report also confirms data from previous economic reports that show consumers are under pressure due to persistent inflation and high interest rates. Consumer spending, which has fueled economic growth, rose only 1.5%, compared to an initial estimate of 2%, the report said.

The report's main finding is that “the economy remained resilient in the first quarter but private sector demand growth slowed, driven by greater consumer caution,” said Gregory Daco, chief economist. from EY, in a note.

Slowing consumer spending could help further dampen inflation, but too much slowdown could have more painful consequences for the economy. The Federal Reserve is trying to synchronize its efforts to bring inflation back to its 2% target without slowing the economy enough to send it into recession.

The stock market has been sluggish this week ahead of the government's next influential inflation report on Friday. The personal consumption expenditures (PCE) index is the Fed's preferred measure of inflation.

Economists expect the report to show a slight slowdown in inflation to 2.6% in May, from 2.7% in April. That's down from PCE's peak of 7.1% in mid-2022. Other measures of inflation, including the consumer price index, have also declined significantly over the past two years.

Latest inflation updates could influence central banks' decision on when to start cutting interest rates, which remain at their highest level in more than 20 years and are having an impact around the world . Wall Street is betting that the central bank will start cutting interest rates at its September meeting.

The S&P 500 is on track for its fourth straight week of gains. With an extra trading day this month, the index is up just under 4% for June and about 15% so far this year.

Overall, the S&P 500 rose 4.97 points to 5,482.87. The Dow Jones gained 36.26 points to 39,164.06. The Nasdaq gained 53.53 points to close at 17,858.68.