US stocks rose today following a weaker than expected increase in core consumer prices.
Shares in Hewlett-Packard rose before the computer maker wraps up the quarterly reporting season among Dow components, and posts figures after the bell.
Abercrombie & Fitch, one of the day's top percentage gainers, jumped after the retailer posted a stronger-than-expected quarterly profit.
Consumer prices, excluding food and energy, rose less than expected in July and followed a weaker reading on producer prices yesterday that sparked a rally in stocks. The Labour Department said the Consumer Price Index for July rose 0.4 per cent from a 0.2 per cent increase in June. The CPI core rate, which excludes food and energy prices, rose 0.2 per cent last month after a 0.3 per cent increase in June, below economists expectations.
The tame growth supports the view the Federal Reserve has room to keep interest rates unchanged in the short term.
In another report, the pace of US home building fell more than expected in July.
"The core rate was elevated enough so that the Fed will remain on inflation alert, but the fact that it wasn't worse than expected and that housing was weak seems to be giving bonds a boost and stocks will likely try to follow through," said Jim Awad, chairman of Awad Asset Management in New York.
The Dow Jones industrial average was up 29.22 points, or 0.26 per cent, at 11,259.48. The Standard & Poor's 500 Index was up 2.95 points, or 0.23 per cent, at 1,288.53. The Nasdaq Composite Index was up 6.19 points, or 0.29 per cent, at 2,121.20.
Shares in HP gained 1.1 per cent to $34.34, while Abercrombie climbed 8.6 per cent to $60.31.
Meanwhile, the pace of U.S. home building fell 2.5 per cent in July to an annualised rate of 1.795 million units, from a downwardly revised 1.841 million, the Commerce Department said.
Among decliners, Applied Materials slid 2 per cent to $15.36 on Nasdaq. The top supplier of equipment for making microchips, reported good profit growth yesterday but said rising chip inventories would hit demand for its products.