US STOCKS-Wall St set to open higher on gains in Apple, in-line inflation reading

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Updates prices before markets open

By Shashwat Chauhan and Sukriti Gupta

Jan 31 (Reuters) - Wall Street's main indexes were set to open higher on Friday on gains in Apple following its strong sales forecast, with an in-line reading for the Federal Reserve's favored inflation gauge keeping expectations about its interest-rate path unaffected.

The personal consumption expenditures price index rose 0.3% in December, compared to a 0.3% increase forecast by economists polled by Reuters. In the 12 months through December, PCE inflation advanced 2.6%, also matching estimates.

Excluding the volatile food and energy components, the PCE price index increased 0.2% last month, against expectations of a 0.2% increase. Annually, it came in at 2.8%, in line with estimates.

Traders kept their bets on the Fed waiting until June to resume rate cuts at 70% after the data was released, futures that settle to the Fed's policy rate indicated.

The central bank held interest rates steady in its latest rate decision earlier this week, and Fed Chair Jerome Powell said there would be no rush to cut them again until inflation and jobs data made it appropriate to do so.

Apple AAPL.O gained 4.2% in premarket trading on upbeat executive comments in its earnings on Thursday, in a sign the company expects to recover from a dip in iPhone sales as it rolls out AI features.

"We still have a buy recommendation on Apple and think that the company is showing some resiliency. Investors were expecting the results to be even weaker than anticipated, so the market is rewarding Apple for holding up quite well," said Sam Stovall, chief investment strategist at CFRA Research.

Chevron CVX.N fell 1.2% after reporting fourth-quarter earnings below estimates, while Exxon Mobil XOM.N rose about 1% after it beat fourth-quarter profit estimates.

Atlassian TEAM.O jumped 19.8% after the enterprise software developer projected third-quarter revenue above estimates and raised its annual revenue forecasts.

At 08:47 a.m. ET, Dow E-minis 1YMcv1 were up 110 points, or 0.24%, S&P 500 E-minis EScv1 were up 25.75 points, or 0.42%, and Nasdaq 100 E-minis NQcv1 were up 156.5 points, or 0.72%.

The S&P 500 .SPX and the Nasdaq .IXIC were set for weekly losses as tech shares suffered a rout after Chinese startup DeepSeek unveiled a breakthrough in low-cost artificial-intelligence models, triggering a bloodbath in AI-linked stocks.

Microsoft MSFT.O plunged more than 6% on Thursday following a disappointing growth forecast in its cloud computing business, exacerbating broader losses.

Despite this week's volatility, all three major indexes were on track for monthly gains, with the S&P 500 less than 1% short of its all-time high, hit last week.

Meanwhile, global markets stayed vigilant after President Donald Trump said on Thursday the U.S. would impose a 25% tariff on imports from Mexico and Canada, repeating his warning ahead of his previously announced Saturday deadline.

Among other movers, Vertex Pharmaceuticals VRTX.O rose 2.3% after the U.S. Food and Drug Administration approved the drugmaker's non-opioid painkiller.

Deckers Outdoor DECK.N dropped 14.9% after the UGG bootmaker's annual sales forecast raise missed lofty expectations following a strong holiday quarter.

Walgreens Boots Alliance WBA.O lost 12% after the pharmacy chain operator suspended its quarterly cash dividend amid restructuring efforts.

(Reporting by Shashwat Chauhan and Sukriti Gupta in Bengaluru; Editing by Pooja Desai and Arun Koyyur)

((Shashwat.Chauhan@thomsonreuters.com;))