U.S. Stocks Holding On To Substantial Gains After Early Rally
Stocks moved sharply early in the session on Tuesday and continue to turn in a strong performance in afternoon trading. The major averages are holding on to substantial gains after reaching their best intraday levels in two months.
The major averages have moved roughly sideways in recent trading, hovering firmly in positive territory. The Dow is up 505.13 points or 1.5 percent at 34,843.00, the Nasdaq is up 326.01 points or 2.4 percent at 14,093.75 and the S&P 500 is up 87.01 points or 2.0 percent at 4,498.56.
The rally on Wall Street comes following the release of the Labor Department’s highly anticipated report on consumer price inflation in the month of October.
The Labor Department said its consumer price index was unchanged in October after climbing by 0.4 percent in September. Economists had expected consumer prices to inch up by 0.1 percent.
Excluding food and energy prices, core consumer prices edged up by 0.2 percent in October after rising by 0.3 percent in September. Core prices were expected to rise by another 0.3 percent.
The report also said the annual rate of consumer price growth slowed to 3.2 percent in October from 3.7 percent in September. Economists had expected the pace of growth to decelerate to 3.3 percent.
Core consumer prices were up by 4.0 percent compared to the same month a year ago, reflecting the smallest year-over-year increase since September 2021.
The annual rate of core consumer price growth was expected to come in unchanged from 4.1 percent in the previous month.
Michael Pearce, Lead U.S. Economist at Oxford Economics, said the slowdown in core price growth should “give Fed officials more confidence that inflation is on a firm downward trajectory, staying its hand for rate hikes.”
Treasury yields have moved sharply lower following the release of the report, adding to the buying interest on Wall Street.
Interest rate-sensitive housing stocks continue to turn in some of the best performances on the day, with the Philadelphia Housing Sector Index spiking by 6.0 percent to its best intraday level in over three months.
Substantial strength also remains visible among airline stocks, as reflected by the 5.9 percent surge by the NYSE Arca Airline Index.
Gold stocks have also moved sharply higher over the course of the session, driving the NYSE Arca Gold Bugs Index up by 5.2 percent. The index is bouncing off its lowest closing level in over a month.
Banking, commercial real estate and networking stocks are also seeing considerable strength, moving notably higher along with most of the other major sectors.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan’s Nikkei 225 Index and China’s Shanghai Composite Index rose by 0.3 percent, while South Korea’s Kospi jumped by 1.2 percent.
European stocks also showed strong moves to the upside on the day. While the German DAX Index spiked by 1.8 percent, the French CAC 40 Index surged by 1.4 percent and the U.K.’s FTSE 100 Index edged up by 0.2 percent.
In the bond market, treasuries continue to see substantial strength after an early rally. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 17.3 basis points at 4.459 percent.
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