Wall Street ends higher after as-expected inflation data; S&P 500, Nasdaq post weekly declines

By Caroline Valetkevitch

NEW YORK (Reuters) - U.S. stocks ended higher on Friday after mostly in-line U.S. inflation data, but the three major indexes posted losses for the week.

The S&P 500 and Nasdaq snapped?three-week streaks of weekly gains.

The Commerce Department's personal consumption expenditures index report for August showed inflation behaving as expected while personal income and consumer spending surprised to the upside. Prices rose by 0.3% last month, and by 2.7% year-over-year, hitting the consensus estimate. The PCE index is considered the Federal Reserve's preferred inflation measure.

Market participants have been weighing signs of a stronger economy against expectations for more interest rate cuts from the Fed. Last week, the U.S. central bank cut rates for the first time since December and indicated more cuts were on the way.

Investors are questioning what the Fed's path is going to be from here, and are positioning for quarter-end, said Bruce Zaro, managing director at Granite Wealth Management in Plymouth, Massachusetts.

"To me, it's typical of quarter-end window dressing... You're going to have some volatility during this period and in the subsequent weeks because you have earnings coming," he said.

The S&P 500's third-quarter earnings season kicks off around mid-October.

Also, shares of truck maker Paccar (PCAR), which makes most of its trucks for the U.S. market domestically, rose 5.2% the day after President Donald Trump unveiled fresh import tariffs, including on heavy-duty trucks.

Trump also slapped new tariffs on branded pharmaceutical products, kitchen cabinets and bathroom vanities along with upholstered furniture. Drugmaker Eli Lilly gained 1.4%.

Electronic Arts shares jumped 14.9% after reports that the videogame publisher was in advanced talks to go private.

The Dow Jones Industrial Average rose 299.97 points, or 0.65%, to 46,247.29, the S&P 500 gained 38.98 points, or 0.59%, to 6,643.70 and the Nasdaq Composite gained 99.37 points, or 0.44%, to 22,484.07.

For the week, the Dow was down 0.2%, the S&P 500 was down 0.3% and the Nasdaq fell 0.7%.

Investors also took in the latest comments from Fed officials. Richmond Fed Bank President Thomas Barkin, in an interview with Bloomberg Television, said he had very low confidence in inflation forecasts, as tariffs continue to impact the economy.

However, Fed Vice Chair Michelle Bowman cited recent labor market data and said it was time "to act decisively and proactively to address decreasing labor market dynamism and emerging signs of fragility."

Investors are anxious to see the September U.S. employment report, due next Friday.?

Also on the horizon, a potential government shutdown could disrupt data releases and add uncertainty to the markets.

Costco Wholesale (COST) fell 2.9%, a day after the company reported quarterly results.

Advancing issues outnumbered decliners by a 2.25-to-1 ratio on the NYSE. There were 205 new highs and 53 new lows on the NYSE.

On the Nasdaq, 2,920 stocks rose and 1,729 fell as advancing issues outnumbered decliners by a 1.69-to-1 ratio.

Volume on U.S. exchanges was 16.98 billion shares, compared with the 18.11 billion average for the full session over the last 20 trading days.

(Additional reporting by Niket Nishant, Sukriti Gupta and Purvi Agarwal in Bengaluru and Sinead Carew in New York; Editing by Shilpi Majumdar and David Gregorio)