July 21, 2024

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U.S. Stocks Move Notably Higher After Early Volatility

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After seeing considerable volatility early in the session, stocks have moved notably higher over the course of the trading day on Tuesday. The tech-heavy Nasdaq is leading the advance, regaining ground following the pullback seen over the two previous sessions.

Currently, the major averages are just off their highs of the session. The Nasdaq is up 188.62 points or 1.2 percent at 16,207.90, the S&P 500 is up 44.90 points or 0.9 percent at 5,162.84 and the Dow is up 228.44 points or 0.6 percent at 38,998.10.

The considerable strength that has emerged on Wall Street partly reflects a positive reaction to the Labor Department’s highly anticipated report on consumer price inflation in the month of February.

The Labor Department said its consumer price index climbed by 0.4 percent in February after rising by 0.3 percent in January. The increase matched economist estimates.

Excluding food and energy prices, core consumer prices also rose by 0.4 percent in February, matching the increase seen in January. Economists had expected core prices to rise by 0.3 percent.

The report also said the annual rate of consumer price growth ticked up to 3.2 percent in February from 3.1 percent in January. The year-over-year growth was expected to be unchanged.

Meanwhile, the annual rate of core consumer price growth slowed to 3.8 percent in February from 3.9 percent in January. Economists had expected the pace of growth to decelerate to 3.7 percent.

While core price growth slowed by slightly less than expected, the slowdown still seems to have added to optimism about the outlook for interest rates.

“Although inflation has continued to ease, much of core inflation remains ‘sticky’ and isn’t unwinding at a pace that would offer the Fed the confidence it needs to begin the easing cycle perhaps even in June,” said Quincy Krosby, Chief Global Strategist for LPL Financial.

She added, “What could help underpin a move in June or July, however, is that Owners Equivalent Rent (OER) has begun to tick…

2024-03-12 10:52:28

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