Wall Street rallies, snaps longest weekly losing streak in decades

PCE price index indicates inflation peaked in March
Dell climbs on strong Q1 results
Gap, American Eagle Outfitters cut profit forecasts
Indexes jump: Dow 1.76%, S&P 2.47%, Nasdaq 3.33%

NEW YORK, May 27 (Reuters) – Wall Street closed sharply higher on Friday as signs of peaking inflation and consumer resiliency sent investors into the long holiday weekend with growing optimism that the Federal Reserve will be able to tighten monetary policy without tipping the economy into recession.

All three major U.S. stock indexes brought a decisive end to their longest weekly losing streaks in decades.

The S&P and the Nasdaq suffered seven consecutive weekly declines, the longest since the end of the dot-com bust, while the blue-chip Dow’s eight-week selloff was its longest since 1932.

“The market has now discounted a lot of the negative news, a lot (of which) hit all at once,” said Keith…