US stocks rise as cooling of key inflation measure supports potential for smaller Fed rate hikes

• US stocks rose Thursday as December trade gets underway.
• The Fed's preferred inflation gauge -- the PCE index -- rose by less than expected in October.

US stocks opened slightly higher Thursday, starting December's trade with an eye on the Federal Reserve potentially downshifting the size of its rate hikes in part after the central bank's preferred inflation measure has eased.

Wall Street's main equity indexes edged up after the Commerce Department said the core Personal Consumption Expenditures Index rose 0.2% in October month over month. The reading, which strips out food and energy prices, was below an Econoday consensus estimate of 0.3%. The PCE Index rose 5% year over year in October compared with 5.2% in September.

Here's where US indexes stood at the 9:30 a.m. opening bell on Thursday:

• S&P 500: 4,086.34, up 0.15%

• Dow Jones Industrial Average: 34,540.05, down 0.14% (49.72 points)
• Nasdaq Composite: 11,468.39, up 0.01%

Stocks soared Wednesday after Federal Reserve Chairman Jerome Powell in a speech at the Brookings Institution said there are signs inflation is starting to ease from scorching levels and that could lead to the Fed sizing down its interest rate hikes as soon as its December meeting.

"Despite the fact that the overall rhetoric remained cautious, with some uncertainty remaining as to how far and for how long higher rates would need to be in place, the comments nonetheless reflected a slight softening of attitude," Richard Hunter, head of markets at Interactive Investor, wrote in a note Thursday.

Wednesday's rally helped equity indexes finish higher in November, with gains of more than 5% for the Nasdaq Composite and the S&P 500.

"The relief bounce has made some difference to the performance of the main indices, but only a quite extraordinary 'Santa rally' could repair the damage which has already been wrought," said Hunter in noting still sharp year-to-date losses for the S&P 500, the Nasdaq and the Dow Jones Industrial Average.

Here's what else is happening today:

• Chinese stocks were up after the country's top pandemic official signals a softening of the country's strict zero-COVID policy.
• Billionaire investor Leon Cooperman says the S&P 500 won't hit a new high for a long time.
• BlackRock CEO Larry Fink thinks most crypto companies will go out of business in the wake of FTX's collapse.

In commodities, bonds, and crypto:

• West Texas Intermediate crude gained 1.9% to $82.10 per barrel. Brent crude, the international benchmark, rose 1.8% to $84.47.
• Gold tacked on 2.4% to $1,801.05 per ounce.
• The 10-year Treasury yield fell 10 basis points to 3.59%.
• Bitcoin fell 0.7% to $16,981.11.