Market Snapshot: Dow up 200 points as stocks hit 3-month highs on optimistic inflation data

by | Aug 11, 2022 | Stock Market

U.S. stocks traded at fresh three-month highs Thursday after another batch of July data suggested inflation may be easing, but were off the day’s best levels in afternoon trade with big technology stocks lagging. How stocks are faring
S&P 500
rose 23 points, or 0.6%, to 4,234.

Dow Jones Industrial Average
climbed 195 points, or 0.6%, to 33,504.

Nasdaq Composite
added 17 points, or 0.1%, to 12,872.

On Wednesday, the Dow Jones Industrial Average rose 535 points, or 1.63%, to 33310, the S&P 500 increased 88 points, or 2.13%, to 4210, and the Nasdaq Composite gained 361 points, or 2.89%, to 12855. The S&P 500 is up 14.8% from its 2022 closing low hit in mid-June but remains down 11.7% for the year to date.

What’s driving markets Stocks surged to their highest levels since early May after the July producer-price index fell 0.5%, compared with expectations for a 0.2% rise, although the three main U.S. stock benchmarks have pared their gains somewhat heading into afternoon trading in New York. See: U.S. producer price inflation moderates in July Thursday’s optimistic inflation report followed a similarly cooler-than-expected reading on U.S. consumer-price growth released a day earlier. That data also helped send stocks soaring, with the Nasdaq exiting bear-market territory and the Dow exiting correction territory. Hopes that inflation has peaked helped encourage investors to pile back into equities based on the view that slowing inflation could allow the Federal Reserve to hike interest rates less aggressively. “While one number certainly doesn’t constitute a trend, the decline in wholesale prices could indicate that supply-chain bottlenecks are improving,” said Charlie Ripley, senior investment strategist at Allianz Investment Management. “Overall, the data, combined with CPI data earlier this week, is a welcome sign that we could be getting close to or have passed peak inflation. However, we would caution that while the trend is improving, we have a long way to go to get back towards 2% inflation.” However, some market analysts are urging caution as rising housing costs could keep core inflation elevated, even as a drop in oil prices and other commodities has helped to reduce inflation expectations. See: Don’t be fooled by a drop in U.S. headline inflation. Markets will be attuned to another figure on Wednesday “Our view is that this is a rally that really deserves a lot of s …

Article Attribution | Read More at Article Source

Share This