After a solid rally this week that saw markets rebound from more than seven consecutive weeks of losses, stocks finished higher on Friday.
The week was the best since November 2020.
The S&P 500 gained 2.5% and the tech-laden Nasdaq was up 3.3%.
The core personal consumption expenditures price index, the Fed's preferred inflation reading, rose 4.9% from a year ago in April, which was down from 5.2% in March.
Despite the positive data, inflation remains at historically high levels and experts warn that it could take some time to normalize.
According to the minutes from the central bank's May meeting, most Fed officials are in favor of raising interest rates by a small amount in June and July.
Strong earnings reports from retailers helped lift markets higher this week and alleviated some recession fears, with shares of Ulta Beauty rising nearly 10% on Friday.
Tech companies led the market gains after investors cheered solid quarterly earnings, and shares of Apple and Amazon both jumped over 3%.
After seven straight weeks of losses, stocks rebounded last week. After falling for seven weeks in a row, the S&P 500 and the Nasdaq rose over 6 percent since Monday, ending an eight-week losing streak. Despite the recent relief rally in markets, stocks are still on pace for one of their worst years in recent history, as investors remain concerned about surging inflation and rising rates.
The recent panic about an imminent recession was overstated, according to Vital Knowledge founder Adam Crisafulli.
The earnings season was not as bad as it was made out to be, with several companies posting decent results. He points to companies like Dell, Dollar General, Dollar Tree, and Macy's as examples of companies with strong quarterly earnings.
The market rebounded as strong earnings alleviate the recession.
20 experts say they will help investors beat the bear market.
Retail stocks rebound, but the shift in consumer spending may continue.
The central bank will raise rates aggressively.
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