By Sruthi Shankar and Parikshit Mishra
(Reuters) - Wall Street's main indexes swung between gains and losses on Thursday after Federal Reserve chair Jerome Powell said the central bank does not see strong evidence of wage inflation.
In his second congressional testimony, Powell also said there is no evidence the U.S. economy is currently overheating, weakening the case for faster interest rates.
In contrast, New York Fed President William Dudley said he was gaining confidence that the U.S. rate hikes will be needed and that four rate hikes would be gradual.
Rising inflation and bond yields were the main concerns as Wall Street ended a turbulent February on Wednesday, with the S&P 500 posting its first monthly loss in 11 months.
"This month will be positive for equity markets because the inflation gauges that we've seen are significantly more modest than investors are expecting," said Peter Kenny, senior market strategist at Global Markets Advisory Group, in New York.
"All this volatility is because investors are in the process of trying to reset their expectations for corporate earnings in a landscape of rising interest rates and fear of inflation."
At 11:52 a.m. ET, the Dow was up 0.13 percent at 25,060.97, the S&P 500 0.17 percent at 2,718.53 and the Nasdaq Composite 0.16 percent at 7,284.88.
Data showed that consumer spending in January notched its smallest increase in five months and core inflation rose less than expected.
Consumer spending, which accounts for more than two-thirds of U.S. economic activity, gained 0.2 percent in January, while core PCE price index, the Federal Reserve's favored gauge on inflation, rose 0.2 percent compared with economists' expectation of a 0.3 percent rise.
Earlier in the day, reports that U.S. President Donald Trump was planning to announce a decision on import tariffs on steel and aluminum pushed industrial stocks lower.
Boeing and Caterpillar were among the biggest decliners on the Dow on fears that import tariffs could hit profits.
Energy stocks were up 1.2 percent, led by a 5 percent gain in Range Resources and a 3 percent rise in Andeavor. Oil prices were still down about 0.8 percent. [O/R]
Advancing issues outnumbered decliners on the NYSE by 1,658 to 1,125. On the Nasdaq, 1,619 issues rose and 1,207 fell.
(Reporting by Sruthi Shankar and Parikshit Mishra in Bengaluru; Editing by Saumyadeb Chakrabarty)
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